European rules prevent the nationalisation of Italy’s trouble bank, Banca Carige, according to one senior Italy senator.
“I am not aware that a nationalization is a doable path under current rules,” Alberto Bagnai, the head of the senate finance committee, told Milano Finanza on January 12 when asked whether it would be better to put Carige in state hands.
Bagnai, an economist and a Eurosceptic senator from the far-right League party, said rules can be “interpreted for friends” but the ruling 5-Star and League coalition “does not yet have many friends in Europe”.
As reported by the Reuters news agency, the leader of the ruling 5-Star Movement, Luigi Di Maio, has said Carige would be nationalised if the state put money in, comments echoed by members of the League Party which is also part of the ruling coalition, although Economy Minister Giovanni Tria has said he prefers a market solution.
Meanwhile, Italy’s government set up a €1.3bn fund last week to shore up Carige after the European Central Bank put it under temporary administration following the bank’s failure to raise capital from investors.
According to Reuters, Rome has several options for state support, including state-backed precautionary recapitalisation.
The European Central Bank (ECB) has pushed Carige to seek a merger with a stronger rival. Finding a buyer is now one of the tasks of the three commissioners appointed to run Italy’s tenth-largest bank.
Two sources told Reuters last week that Italy’s biggest bank UniCredit might consider buying Carige if such a deal came with state financial support.