FILE PHOTO: A Hotel in the case of FCA, the worker in the Mirafiori industrial complex,” on the 80th birthday of the plant in Turin, Italy, 11. July 2019. (Photo/Massimo Pinca, File Photo
MILAN (Reuters) – A 6.3 billion Euro ($7 billion) state-backed loan-for-Fiat-Chrysler (FCA) (FCHA.MI) financed by Intesa Sanpaolo (ISP.MIit is crucial to secure Italy’s economy, the head of the country’s largest bank, said.
The loan agreement for the FCA that is to 80% by the state and guaranteed by an export credit agency, SACE, has stirred controversy in Italy, as the carmaker, which moved its legal headquarters in the Netherlands, the progress towards a merger with Peugeot, owned by PSAPEUP.PA).
Speaking to Corriere TV, Intesa’s CEO Carlo Messina said the loan was necessary to protect a sector, a share of 6% of the Italian economic performance, as the participants in a Band, the financing of the payments to staff and suppliers, as well as the investment.
“With this transaction, we support an important sector of the economy, its suppliers, and employment,” Messina said.
“It is a key-board (or the efforts to protect the economy in the current phase, and if we do not have the support of sectors, which are vital to the GDP, such as the automotive and construction … instead of a 10% GDP contraction, we have to fall 15%,” he added.
Reporting by Valentina Za and Elvira Pollina; editing by Giulia Segreti