Cassa di Risparmio di Ferrara

Cassa di Risparmio di Ferrara, commonly known as Carife, was a historic Italian savings bank headquartered in Ferrara, Emilia-Romagna. Founded in 1838 by Count Alessandro Masi, it developed from a local savings institution into a regional banking group serving households, businesses and public-sector communities in and around Ferrara. Its activities included deposits, lending, payment services, leasing, factoring and other financial products. The institution was among the older savings banks established in the former Papal States. Carife expanded substantially during the twentieth and early twenty-first centuries. Between 1927 and 1942 it absorbed or acquired several local banks and credit institutions, including the savings bank of Copparo, Banca Mutua Popolare di Bondeno, the Ferrara monte di pietà, Banca di Portomaggiore, Monte di Credito su Pegno di Comacchio and Banca Popolare Cooperativa di Argenta. Following the Italian banking reform of 1991, the bank’s operating business was separated from its philanthropic foundation. The banking business became a joint-stock company, while Fondazione Cassa di Risparmio di Ferrara retained the charitable and cultural mission and initially remained the principal shareholder. The group pursued a more expansive acquisition strategy from the 1990s onward. It acquired Banca di Credito Agrario di Ferrara in 1994 and subsequently added leasing, factoring and banking businesses, including Commercio e Finanza, Banca di Treviso, Banca Popolare di Roma, Credito Veronese, Finproget, Banca Modenese, Banca Farnese and Banca di Credito e Risparmio di Romagna. Several subsidiaries were later merged into or converted into divisions of the bank. This expansion increased the group’s geographic reach but also left it exposed to deteriorating asset quality and capital pressures. In 2013 Carife was placed under special administration by Italy’s Ministry of Economy and Finance. The bank’s 2012 accounts reported shareholders’ equity of €374 million and a Tier 1 capital ratio of 6.41 percent at year-end, figures that reflected the institution’s weakened capital position. In November 2015, following a resolution process involving four troubled Italian banks, the original Carife was placed into liquidation as a bad bank. Its impaired assets were separated from a newly created operating institution, Nuova Cassa di Risparmio di Ferrara, generally called Nuova Carife. The non-performing assets were transferred to REV – Gestione Crediti, while the new bank was recapitalized by the Italian National Resolution Fund. The resolution also imposed losses on shareholders and subordinated bondholders. The treatment became politically controversial because retail customers had often acquired bank bonds through their local banks. In 2016 the Italian government introduced a compensation mechanism for certain eligible retail bondholders, subject to purchase-date and other conditions. Nuova Carife was short-lived. BPER Banca agreed in March 2017 to acquire it for a nominal consideration, subject to recapitalization, the disposal of non-performing loans and other resolution conditions. The Resolution Fund provided further capital, while a portfolio of non-performing loans was sold to Atlante II and Credito Fondiario. The acquisition was completed in June 2017, and a plan to absorb Nuova Carife into BPER Banca was announced in July and completed later that year. The Carife banking brand therefore ceased to operate as an independent bank, while Fondazione Carife survived as a charitable organization in Ferrara.

Cassa di Risparmio di Ferrara was established in 1838 in Ferrara by Count Alessandro Masi. It belonged to the tradition of Italian casse di risparmio, institutions designed to collect household savings and channel them into local economic development. At the time of its creation, Ferrara was within the Papal States, and the bank became one of the early savings institutions in that political territory. During the period from 1927 to 1942, Carife consolidated much of the local banking landscape. It acquired Cassa di Risparmio di Copparo, Banca Mutua Popolare di Bondeno, the local Ferrara monte di pietà, Banca di Portomaggiore, Monte di Credito su Pegno di Comacchio and Banca Popolare Cooperativa di Argenta. These transactions reflected Italian legislation that encouraged or required smaller savings banks to combine with larger institutions when they fell below prescribed size thresholds. The Italian banking reforms of 1991 separated the bank’s commercial operations from its social and philanthropic role. In December of that year, the operating bank was organized as a società per azioni, while Fondazione Cassa di Risparmio di Ferrara became the associated banking foundation. The foundation continued to support cultural, social and heritage projects in the Ferrara area and remained the dominant shareholder of the banking company for much of the old bank’s later life. Carife then developed into a broader banking group. It acquired Banca di Credito Agrario di Ferrara in 1994. In 2002 it added Commercio e Finanza – Leasing e Factoring, followed in 2003 by Banca di Treviso, Banca Popolare di Roma and Credito Veronese. Finproget was acquired in 2004; Banca Modenese and Banca Farnese followed in 2005; and Banca di Credito e Risparmio di Romagna joined the group in 2008. Banca di Treviso was later sold to Banca Popolare di Marostica, while part of Banca Farnese was transferred to Banca Centropadana. In 2012 several subsidiaries, including Banca Popolare di Roma, Banca Modenese, Banca di Credito e Risparmio di Romagna and Finproget, were merged into the Carife structure or converted into divisions. The expansion was followed by financial deterioration. In 2013 the bank entered special administration under the Ministry of Economy and Finance. Its reported 2012 shareholders’ equity was €374 million, while the Tier 1 capital ratio stood at 6.41 percent at 31 December 2012. A proposed interbank deposit-insurance intervention was considered in 2015, but the eventual resolution was carried out through the Italian National Resolution Fund after the European banking-recovery framework had taken effect in Italy. On 22 November 2015, the original Carife was placed into liquidation and its viable operations were transferred to Nuova Cassa di Risparmio di Ferrara S.p.A. The new bank had stated share capital of €191 million, and its impaired assets were moved to REV – Gestione Crediti, a bad-bank vehicle also used for other resolved Italian institutions. Shareholders and subordinated bondholders of the old bank were subjected to the resolution losses. Nuova Carife reported group equity of €161 million and a CET1 ratio of 8.22 percent at 31 December 2015. The resolution generated public criticism, particularly over the sale of subordinated bank bonds to retail investors and the losses suffered by those investors. In response, Decree-Law No. 59/2016 created a solidarity fund administered through the interbank deposit-protection system. The mechanism offered compensation to certain eligible purchasers, with conditions based on the date and circumstances of acquisition and a maximum reimbursement limit. Nuova Carife remained financially dependent on further restructuring. At the end of 2016, heavy loan write-downs had left the group with negative net equity of €66 million. In March 2017 BPER Banca agreed to acquire the bank for a nominal €1, provided that the Resolution Fund supplied further recapitalization and that non-performing exposures were dealt with. In June, approximately €343 million of gross-book-value non-performing loans were sold to Atlante II and Credito Fondiario, and the Resolution Fund recapitalized the bank by €290 million. BPER completed the takeover on 30 June 2017. An absorption plan was announced on 1 July and completed during 2017. The banking entity consequently became defunct as an independent institution. Fondazione Carife, the former banking foundation, survived separately as a Ferrara-based charitable organization. Its activities have included support for the restoration of Santa Maria in Vado, works in Ferrara Cathedral and the Oratorio dell’Annunziata.

1. 2017Acquisition and absorption by BPER Banca

   BPER acquired Nuova Carife after recapitalization and non-performing-loan disposal, then absorbed it into the BPER group.

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2. 2016Retail bondholder compensation framework

   Italy introduced a solidarity-fund mechanism for certain retail investors affected by the resolution of Carife and three other banks.

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3. 2015Nuova Carife established

   The original bank was resolved and its viable operations were transferred to a newly formed good bank, Nuova Cassa di Risparmio di Ferrara.

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4. 2013Special administration

   The bank was placed under special administration by the Italian Ministry of Economy and Finance.

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5. 1994Banca di Credito Agrario di Ferrara acquired

   Carife expanded its regional banking operations through the acquisition of Banca di Credito Agrario di Ferrara.

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6. 1991Banking business separated from foundation

   The operating bank was separated from Fondazione Cassa di Risparmio di Ferrara under Italian banking reform.

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7. 1927Beginning of local consolidation

   Carife began a period of acquisitions and consolidations involving local savings banks, cooperative banks and charitable credit institutions.

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8. 1838Cassa di Risparmio di Ferrara founded

   Count Alessandro Masi founded the savings bank in Ferrara.

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A historically local and regional savings bank focused on retail customers, small and medium-sized businesses, and the economic and civic life of Ferrara and surrounding areas.

• Savings and current accountsRetail banking

  Core deposit and transaction services associated with a regional savings bank, serving households, local organizations and businesses. The available reference material identifies Carife as a savings bank but does not provide named account products or detailed terms.

• Loans and mortgagesLending

  Retail, commercial and possibly residential lending formed part of Carife’s traditional banking activity. The bank’s regional role included financing households and local enterprises, although specific branded loan products are not identified in the reference material.

• Leasing and factoringSpecialized finance2002

  Carife expanded beyond conventional deposits and lending through Commercio e Finanza – Leasing e Factoring, acquired in 2002. The business was later planned for absorption into Nuova Carife during the resolution period.

• Corporate and payment servicesCommercial banking

  The group served companies and institutions through commercial banking, payment infrastructure and related financial services. Specific product names, channels and service specifications are not available in the supplied sources.

• 2017Sale of Nuova Carife to BPER BancaM&A

  Nuova Carife remained financially weak after resolution, with negative group net equity reported at the end of 2016 and substantial non-performing loans requiring treatment.

  What changed. BPER Banca agreed to acquire Nuova Carife for a nominal €1, conditional on further recapitalization by the Resolution Fund and the sale of non-performing loans.

  Aftermath. The Resolution Fund injected €290 million, a gross-book-value non-performing-loan portfolio of about €343 million was sold, and BPER completed the acquisition on 30 June 2017. Nuova Carife was subsequently absorbed into BPER.

  Resolution Fund recapitalization. €290 million (2017)

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• 2015Resolution and creation of a good bankStrategy

  Carife was under special administration and faced capital weakness and deteriorating assets. Italian authorities resolved it together with three other troubled banks under the post-Bank Recovery and Resolution Directive framework.

  What changed. The viable operations were transferred to Nuova Cassa di Risparmio di Ferrara, while impaired assets were placed in a shared bad-bank vehicle and the original legal entity entered liquidation.

  Aftermath. The transaction preserved an operating bank but eliminated the equity value of the old shareholders and subordinated bondholders. Nuova Carife was owned by the Italian National Resolution Fund until its sale to BPER Banca.

  Initial share capital of Nuova Carife. €191 million (22 November 2015)

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• 2017BPER Banca agrees to acquire Nuova Carife

  BPER Banca signed an agreement to acquire Nuova Carife for a nominal price, conditional on additional resolution-fund support and the disposal of non-performing loans.

  M&A
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• 2017Nuova Carife sells non-performing loan portfolio

  A gross book value portfolio of approximately €343 million in non-performing loans was sold to Atlante II and Credito Fondiario during the preparation for the BPER transaction.

  Other
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• 2017Nuova Carife absorbed into BPER Banca

  Following completion of the takeover, BPER announced and completed the integration of Nuova Carife, ending its existence as an independent banking institution.

  M&A
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• 2016Compensation scheme announced for eligible retail bondholders

  Decree-Law No. 59/2016 established a solidarity mechanism intended to reimburse qualifying retail investors in subordinated bonds issued by the resolved banks, subject to conditions including purchase timing and an upper limit.

  RegulationOther
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• 2015Italian resolution process creates Nuova Carife

  On 22 November, the original Carife was separated into a liquidated bad bank and a new operating bank, Nuova Cassa di Risparmio di Ferrara, supported by the Italian National Resolution Fund.

  BankruptcyRegulation
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• 2013Carife placed under special administration

  The Italian Ministry of Economy and Finance placed Cassa di Risparmio di Ferrara under special administration as the bank faced capital and asset-quality problems.

  RegulationOther
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1. Cassa di Risparmio di Ferrara