Banking Godfather under Suspicion

The governor of the bank of Italy has a very strange job description. He is not only doing the job that his counterparts do in Central Banks around the world, but is also chief regulator of the finance sector. As if this conflict of interests wasn’t enough, the job is his for life. Well that is for life unless he is force to resign.

Antonio Fazio, governor of the Bank of Italy, was under siege on Wednesday from prosecutors, politicians and unions after leaked documents fuelled suspicions of his alleged bias in handling an Italian bank takeover battle.

Senor Fazio is largely regarded as a protectionist who wishes to stop foreign banks from buying Italian ones. As no merger or takeover can happen without his approval, this makes life difficult for those foreigners that want to enter the market. ABN Amro is the current bogeyman. Of course stopping a Dutch bank buying an Italian one is not exactly within the norms of behaviour expected in the EU. So he could be in hot water if his independence on this matter is called into question.

Mr Fazio was recorded revealing a central bank decision to approve a bid for Banca Antonveneta by Banca Popolare Italiana, another Italian bank, to BPI's chief executive before it was publicly announced.

We await the outcome of the investigations with interest. Its funny how most of the EU seems to consist of countries that think EU Law is an open buffet. They only pick the ones they want and ignore the rest. No wonder the EU is popular in countries like that.