Rome court summons Bank of Italy over Monte Paschi
By Antonella Cinelli
ROME (Reuters) - A court in Rome has summoned Bank of Italy officials for questioning on the state bailout of Monte dei Paschi, as scandal spread over the trading that plunged the world's oldest bank into trouble.
The Lazio regional administrative court said in a statement on Wednesday that it had called Deputy Governor Fabrizio Saccomanni and Luigi Federico Signorini, the official in charge of bank supervision, to a hearing on Saturday. The central bank said they would not attend, but would be represented by counsel.
The Bank of Italy, headed at the time by Mario Draghi who has gone on to head the European Central Bank, faces criticism of its supervision of the 540-year-old institution from Siena and of its role in approving a government bailout last week.
The summons to the central bankers follows a request to the court by consumer lobby Codacons to block the 3.9-billion euro ($5.3 billion) state loan approved by the Bank on Saturday.
Monte dei Paschi was left facing losses of 720 million euros ($977 million) on a series of derivative and structured finance transactions. Already badly weakened by paying 9 billion euros cash for rival Antonveneta just before the 2008 global crash, the trades appear to have been made to hide losses on that deal.
Regulators including the Bank of Italy have faced mounting pressure over their failure to head off the problems, despite repeated warnings dating back to at least 2009 that Monte dei Paschi's financial position risked sliding out of control.
Less than a month before a national parliamentary election on February 24-25, the case has also raised questions over the close links between Monte dei Paschi and local Tuscan politicians who dominate the shareholder foundation which controls the bank.
On Thursday, Bank of Italy deputy managing director Fabio Panetta defended the central bank's handling of the case, saying: "Our oversight has been continuous and impeccable." Continued...