* BMPS could repay Tremonti bond early with cap hike
* Net income 985.5 million euros with 405 million capital gain
* Thomson Reuters I/B/E/S forecast 442 million euros
* Shares down 3.8 percent
(Adds CEO and analyst comments, shares)
By Ian Simpson and Stefano Bernabei
MILAN/ROME, March 29 (Reuters) - Italian lender Banca Monte dei Paschi di Siena said it was committed to boosting capital but gave no detail about possible moves after a surprise capital hike at UBI Banca sent sector shares lower.
Monte dei Paschi, seen as a prime Italian candidate to boost capital, is committed to all measures to pay back 1.9 billion euros ($2.7 billion) in government crisis-fighting aid, general manager Antonio Vigni said on Tuesday.
Italy's No.3 retail lender by market value could pay back the government bond ahead of the 2013 deadline if a capital hike were carried out, he told analysts on a conference call about 2010 results that beat forecasts.
"Within this path we will continue the capital management moves to reimburse the Tremonti bond ahead of time," Vigni said. The bond is named for Italian Economy Minister Giulio Tremonti.
Vigni sidestepped repeated questions about details of a capital increase and its possible timing.
"The bank asked for management's commitment (to raise capital) and the numbers are those we've achieved," Vigni said.
Monte dei Paschi, the world's oldest bank, barely cleared a European health check last year. It was the single biggest recipient of government aid during the financial crisis.
Elena Perini, an analyst at Centrobanca in Milan, said the lack of capital increase news was not a surprise. The move could anyway be announced in a business plan set to be released by summer, she said.
"The current market valuation already prices in a capital increase of up to 2 billion euros. In any case, they are organically generating capital," Perini said.
SURPRISE CAPITAL MOVE
Monte dei Paschi's Tier 1 capital ratio, a measure of financial strength, was 8.4 percent at the end of December, up from 7.5 percent the year before. It said new Basel III rules would hit it by 30 basis points in 2014.
Italian banking shares fell sharply after UBI Banca, Italy's fifth-biggest bank by market value, unexpectedly said late on Monday it would raise its capital by up to 1 billion euros as European lenders get ready for tougher bank capital requirements.
Shares in UBI Banca were down 9.75 percent at 1105 GMT as the STOXX Europe 600 banking index was 1 percent lower. Banca Popolare di Milano, also seen as a candidate to raise capital, was down 6.2 percent.
Monte dei Paschi was down 3.8 percent.
Monte dei Paschi reported 2010 net income of 985.5 million euros including a capital gain of 405 million on real estate and properties. A Thomson Reuters I/B/E/S poll had forecast 442 million euros.
Monte dei Paschi proposed a dividend of 0.0245 euro a share. (Reporting by Ian Simpson and Stefano Bernabei; Editing by Jon Loades-Carter) ($1=.7084 Euro)