* Bond offers should summarise factors that could hit yield
* Calls for international rules on short-selling
* Wants global coordination on "fair value"
(Combines earlier, adds further comments from Consob)
MILAN, July 13 Bonds issued by Italy's banks do
not have enough liquidity nor price transparency to make them
suitable investments for retail customers, the head of Italy's
bourse regulator Consob said on Monday.
Over a third of investments by Italian families are in bank
"This paper in fact ... does not enjoy adequate liquidity
nor price transparency," Consob Chairman Lamberto Cardia said in
the text of a written speech to launch the regulator's 2008
That provides conditions which are "particularly
disadvantageous" to small investors, he said.
Cardia added that Consob would pay particular attention to
the application of MiFID -- Markets in Financial Instruments
Directive -- regulations to these types of issues.
He added that the regulator would be consulting shortly on
possible changes to such public offers to include, for example,
a summary of factors which could affect the expected yield and
the level of risk.
Turning to short-selling, he said there should be
international regulation to maintain liquidity and efficiency.
"Consob is aware of the need to define a stable and
internationally-coordinated regulation for short-selling ...
with the aim of keeping market integrity without compromising
liquidity and the efficiency of price formation mechanisms," he
said in the speech.
Italy's current curbs on short-selling run to the end of
He criticised MiFID directives and European regulations on
takeover practice, saying they had been weakened by compromises
made to get them approved.
For Italy, he said current rules on takeovers and disclosure
which were introduced to protect Italian companies from hostile
bids during the worst of the financial crisis could be set time
limits once the situation improved.
Cardia said that although the principle of "fair value" was
not under discussion, the economic crisis had thrown up the need
to rethink its application in valuing financial instruments.
"The issue should be considered at a global level, to ensure
coherence between American and international standards," Cardia
(Reporting by Paola Arosio and Valentina Za, writing by
Marie-Louise Gumuchian and Jo Winterbottom; Editing by Rupert