(Adds background on Eurovita rescue)
MILAN, May 4 (Reuters) - Italian banks and insurers that
are being called upon to rescue struggling life group Eurovita
will help by using their balance sheet, Poste Italiane's CEO
said on Thursday, without elaborating.
Matteo Del Fante said in response to a question during a
post-results analyst call that it was reasonable to assume that
the Italian post office would help to bear the cost of a
Eurovita rescue, which is estimated at around 400 million euros,
based on its 20% share of the life insurance market.
The Poste Italiane chief executive said all the main Italian
insurers and banks distributing products by Cinven-owned
Eurovita were working on a possible solution.
"Everybody would use their balance sheet instead of funding
a recapitalisation," he said, adding he could not explain more.
After rapidly expanding following its acquisition by Cinven
in 2017, Eurovita ran into trouble when rising interest rates
prompted customers to redeem low-yielding life policies to chase
higher returns in assets such as government bonds.
Italian authorities have taken over management of Eurovita
and are working on brokering a rescue after strong-arming Cinven
into pumping 100 million euros of capital into the insurer.
The Bank of Italy's latest Financial Stability Report last
week said that redemptions in the life insurance sector amounted
to 85% of premiums at the end of March, compared with 53% as of
the end of December.
For insurers that rely on banks and financial advisers for
their distribution, redemptions totalled 119% of premiums.
(Reporting by Valentina Za; Editing by Gianluca Semeraro and
Alexander Smith)
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