Nomura to incur $287m loss due to Monte dei Paschi settlement
Nomura has agreed to pay $287m to settle a legal dispute with Monte dei Paschi di Siena, despite not accepting its guilt over ﻿the allegations made against it﻿. Monte Paschi alleged that Nomura had colluded with former Monte Paschi executives to conceal a ﻿"substantial loss of about €220m", known as the Alexandria Notes, when the Japanese bank restructured an existing Monte Paschi investment; t﻿his made the bank look healthier to regulators than it was. Monte Paschi has said that ﻿this settlement will significantly improve its capital position, and puts any litigation with Nomura to rest.

HONG KONG — Nomura, the Japanese financial group, said on Thursday that it had reached a settlement with Banca Monte dei Paschi di Siena in Italy over a multimillion-dollar derivative transaction that went bad, known as the Alexandria notes.

The complex derivatives contract from 2009 was one of several used to conceal Monte dei Paschi’s difficulties by transferring risks to other banks, generating profits and losses. The Italian lender recorded the gains but did not disclose the losses.

After the perilous state of Monte dei Paschi’s finances was revealed in 2013, Fabrizio Viola, the chief executive who took over in 2012, had to work with the bank’s chairman, Alessandro Profumo, to repair the bank’s finances and reputation.

Monte dei Paschi said in February 2013 that it had lost 730 million euros, or $818 million at the current exchange rate, on three of these transactions. One of the deals was the Alexandria contract with Nomura, which it said cost it €273.5 million. It sued Nomura in March 2013 for the losses it said it suffered as a result of the deal.