January 30, 2018 / 10:49 AM / a year ago

Italian banking commission fails to approve joint findings

ROME (Reuters) - A cross-party parliamentary commission set up to look into the collapse of 10 Italian banks in the past two years has failed to agree on joint findings, with parties presenting their own conflicting conclusions.

The commission started work only in September and quickly became a focal point of political campaigning ahead of a national election on March 4.

Opposition parties, led by the anti-establishment 5-Star Movement and the right-wing Northern League, have lambasted the ruling Democratic Party (PD) for the banking scandals, in which thousands of Italians lost their savings.

The PD and its allies tabled conclusions laying blame for the scandals in the hands of bank supervisors, particularly the central bank. But 5-Star, the League and Silvio Berlusconi’s Forza Italia disassociated themselves from the 51-page document.

The Bank of Italy denies any blame for the problems of the sector.

Davide Zoggia, a commission member from the left-wing Free and Equal party, called the PD’s report “a compromise that doesn’t address the substance of the problems and contains grave omissions”.

The PD and its leader Matteo Renzi were widely considered to have been damaged by the commission’s work, with testimony from some witnesses allowing the opposition to allege political meddling and conflicts of interest among close Renzi allies.

The PD has been falling in opinion polls and is expected to lose power in the March vote.

“We cannot accept that after two months of work these are the conclusions,” said 5-Star lawmaker Carlo Sibilia. He complained that the PD conclusions failed to guarantee compensation for those who had lost their savings in the failed banks.

The government spent more than 20 billion euros ($24.8 billion) last year to prop up the banking sector. It injected 5.4 billion euros to salvage Italy’s fourth-biggest bank, Monte dei Paschi di Siena, and offered billions in guarantees as it wound down two major banks in the Veneto region.

Four other smaller banks were wound down in 2015, hitting small savers.

The PD’s document called for a public “bad bank” to be set up to manage lenders’ soured debts and said supervisory authorities must share information with each other more fully.

5-Star’s own conclusions called for the Bank of Italy to be nationalized, in place of the current structure in which it is owned by the country’s banks and insurers.

All the parties proposed measures aimed at preventing officials switching between jobs in banks and positions in supervisory authorities, a practice which has been widespread.

Underscoring the political sensitivity of the bank issue, 5-Star announced on Monday it would field a businessman who lost money in the scandals as its candidate to challenge Prime Minister Paolo Gentiloni in his Rome constituency.

5-Star’s Angiolino Cirulli lost his savings when the small Banca Etruria collapsed. The bank became a lightning rod for opposition fury because one of its board members was the father of a close Renzi ally and cabinet minister.[nL8N1OK23L]

($1 = 0.8065 euros)

Writing by Crispian Balmer and Gavin Jones; editing by Mark Heinrich

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