It’s been a wild ride for the world's oldest bank. Honestly, if you’d asked most traders five years ago about monte dei paschi stock, they probably would have rolled their eyes or told you to run for the hills. For a decade, Banca Monte dei Paschi di Siena (MPS) was basically the poster child for everything wrong with European banking. It was a messy saga of state bailouts, mountain-high bad loans, and endless restructuring plans that never quite seemed to stick.
But things look a lot different now.
As of early 2026, the vibe surrounding the Sienese lender has shifted from "survival mode" to "growth story." The Italian government, which stepped in to save the bank back in 2017, has been aggressively trimming its stake. Just recently, in January 2026, Rome offloaded another 15% for over a billion euros. That’s a huge deal. It brought the state’s ownership down to roughly 11.7%, effectively turning MPS back into a private-market player.
The market is actually paying attention this time.
The Mediobanca Factor and a Shifting Landscape
You can't talk about monte dei paschi stock right now without mentioning the massive consolidation happening in Italian finance. Remember when MPS was just trying to keep the lights on? Well, those days are gone. The bank has been at the center of a "third hub" strategy in Italy, designed to create a heavyweight competitor to UniCredit and Intesa Sanpaolo.
The acquisition of a majority stake in Mediobanca in 2025 was the real game-changer. It wasn't just about getting bigger; it was about getting smarter. By absorbing Mediobanca's high-margin wealth management and investment banking arms, MPS diversified its income away from just simple retail lending.
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Basically, they aren't just relying on interest rates anymore.
Why the Financials are Suddenly Turning Heads
The numbers coming out of Siena are actually... good? It sounds weird to say, but the 2025 results showed a net profit of around €1.4 billion. That’s a 17.5% jump year-on-year. While net interest income took a slight hit because the ECB started cutting rates, the bank made up for it with a massive surge in fees and commissions.
Investors love fees. They are steady, they don't require capital to be locked up, and they don't disappear the second a central bank changes its mind.
The bank’s CET1 ratio—the gold standard for measuring a bank's financial strength—is sitting at a rock-solid 16.9%. For context, that’s way above what regulators require. It’s a fortress-level balance sheet that few expected to see a few years back. Because the bank is so over-capitalized, they’ve started talking about a 100% dividend payout ratio for the 2025 results. You read that right. Management is looking to return a massive chunk of change to the people holding the shares.
What Most People Get Wrong About the Risks
Is it all sunshine? No. Banking is still a risky business, and MPS has a lot of history to outrun. One of the biggest misconceptions is that the bank is still drowning in "junk" loans.
Actually, the Non-Performing Exposure (NPE) ratio has been slashed to about 3.7% gross. That's a massive cleanup compared to the double-digit nightmares of the 2010s. However, the bank is still in the middle of a massive workforce reduction, aiming to cut 150 branches by the end of 2026. Transitioning a 550-year-old institution into a lean, digital-first operation is like trying to turn a cruise ship in a bathtub.
There’s also the political angle. Since the Italian Ministry of Economy and Finance (MEF) is still a shareholder, there's always a lingering fear of political interference. But with Delfin (the Del Vecchio family holding) and Banco BPM now holding significant chunks of the bank, the "private" influence is finally outweighing the "state" influence.
The Technical Outlook for 2026
If you’re looking at the charts, monte dei paschi stock has been trending upward with some serious momentum. Analysts have been nudging their price targets toward the €10 to €12 range. In mid-January 2026, the stock was trading around €9.31, showing a strong "Buy" or "Strong Buy" consensus from most major firms like Morningstar and various Italian brokerages.
Technically, the stock is sitting above its 50-day and 200-day moving averages. Volume is rising alongside the price, which usually means the big institutional "smart money" is moving in.
But don't ignore the RSI. It’s been hovering near overbought territory recently. A bit of a breather or a "pullback" to support levels around €8.50 wouldn't be surprising or even unhealthy.
Actionable Insights for Investors
If you're thinking about adding this to your portfolio, there are a few specific things to keep an eye on over the next few months:
- Watch the February 4, 2026 Shareholders Meeting: This is where the big decisions on capital structure and the new 2026-2029 business plan will likely be teased. Any news on higher-than-expected buybacks could send the stock higher.
- Monitor the Dividend Ex-Date: With a projected yield nearing 9%, the stock will likely see a lot of "dividend hunting" activity as we approach the spring payout.
- Keep an eye on Banco BPM: They currently hold about 5% of MPS. If they decide to increase that stake toward 10%, it signals further consolidation and could act as a floor for the share price.
- Mind the ECB: Any sudden shifts in European inflation or interest rate policy will hit bank stocks first. MPS is more resilient now than it used to be, but it’s still sensitive to the macro environment.
The story of MPS has moved from a tragedy to a recovery, and now it’s looking like a legitimate value play. It’s no longer just the "oldest bank in the world"; it’s becoming a modern, profitable competitor that’s finally rewarding the investors who stuck by it.
To stay ahead of the curve, set alerts for the bank’s quarterly earnings releases and track the daily volume on the Borsa Italiana. Pay close attention to the €9.45 resistance level—breaking through that could signal the next major leg of this multi-year rally.