Italy's League announce bill to overhaul central bank's governance
League revives bill put forward in mid-2019
Move came amid turmoil over Unicredit bid for Banco BPM
League leader questioned role of central bank
By Angelo Amante and Giuseppe Fonte
ROME, Nov 26 (Reuters) -Italy's co-ruling League party said on Tuesday it was drawing up a bill to boost politicians' powers to name senior central bank policymakers, reforming the current system by which appointments are largely made mainly internally.
"Parliamentary involvement is imperative to avoid a dangerous self-referentiality of supervisors," Alberto Bagnai, League lawmaker and deputy chairman of the finance committee in the lower house of parliament, said in a statement.
A leading eurosceptic, Bagnai added the bill was identical to a proposal put forward in mid-2019, when the League was in a coalition with the anti-establishment 5-Star Movement, but it was never approved.
The Bank of Italy's governor is currently appointed through a complicated procedure that involves the government, but also requires consultation with the central bank's main internal body, known as its "superior council".
The other board members are proposed by the superior council and then rubber-stamped by the government.
The 2019 draft bill said three board members, including the governor and his deputy, should be appointed by the prime minister after consultation with the cabinet.
Of the other two, one should be named by the lower house Chamber of Deputies and the other by the upper house Senate, by secret votes requiring an absolute majority of those present in each house.
The bill also said any modifications to the Bank of Italy's statute must in future be decided by parliament through a law.
As things stand, changes to the statute can only be proposed by the assembly of the Bank of Italy's shareholders.
The move came amid political turmoil over UniCredit's CRDI.MI unsolicited bid for rival Banco BPM BAMI.MI.
League leader and Deputy Prime Minister Matteo Salvini voiced doubts about the deal, while also questioning the role of Bank of Italy's top officials.
UniCredit's move risks scuppering the government's plans to form a third strong banking player alongside Intesa Sanpaolo ISP.MI and UniCredit through a merger of Banco BPM with state-owned Tuscan lender Monte dei Paschi di Siena (MPS) BMPS.MI.
"The question for me and for many savers is: Is Bank of Italy there? What does it do? Does it supervise? Since they are among the highest paid in Italy, as an Italian citizen I would like to know if it's all under control," Salvini said.
"I wouldn't want someone to want to stop the Banco BPM-MPS deal to do favour to others," he added, without elaborating.
Editing by
Related Assets
Latest News
Disclaimer: The XM Group entities provide execution-only service and access to our Online Trading Facility, permitting a person to view and/or use the content available on or via the website, is not intended to change or expand on this, nor does it change or expand on this. Such access and use are always subject to: (i) Terms and Conditions; (ii) Risk Warnings; and (iii) Full Disclaimer. Such content is therefore provided as no more than general information. Particularly, please be aware that the contents of our Online Trading Facility are neither a solicitation, nor an offer to enter any transactions on the financial markets. Trading on any financial market involves a significant level of risk to your capital.
All material published on our Online Trading Facility is intended for educational/informational purposes only, and does not contain – nor should it be considered as containing – financial, investment tax or trading advice and recommendations; or a record of our trading prices; or an offer of, or solicitation for, a transaction in any financial instruments; or unsolicited financial promotions to you.
Any third-party content, as well as content prepared by XM, such as: opinions, news, research, analyses, prices and other information or links to third-party sites contained on this website are provided on an “as-is” basis, as general market commentary, and do not constitute investment advice. To the extent that any content is construed as investment research, you must note and accept that the content was not intended to and has not been prepared in accordance with legal requirements designed to promote the independence of investment research and as such, it would be considered as marketing communication under the relevant laws and regulations. Please ensure that you have read and understood our Notification on Non-Independent Investment. Research and Risk Warning concerning the foregoing information, which can be accessed here.
