Under Antonio Fazio, Italy’s central bank seemed to have become an autocracy, with the now disgraced ex-governor its all-powerful boss. Governance will have to be a priority for the new governor, Mario Draghi. David Lane reports on the immense confidence rebuilding task ahead.Italy’s reputation for institutional excellence is, to put it mildly, far from the country’s strong point. Italian corruption scandals are legendary for involving a wide range of participants from all walks of life: business, politics and public bodies.
UniCredit, Italy’s biggest bank by market capitalisation, last month announced a €15bn deal to merge with Germany’s HypoVereinsbank.The news will be welcomed by the Italian president, Carlo Azeglio Ciampi, who has a background in banking and is an unapologetic enthusiast for European integration.
Massimo Arrighetti, head of retail at Italy’s Banca Intesa, talks to Stephen Timewell about the earthquake in his bank’s retail sector that has led not only to a radical rethink, but also to a step change in processes.When Banco Ambrosiano Veneto, Cariplo and Banca Commerciale Italiana joined forces in late 2002 to form the largest bank in Italy, Banca Intesa, they also formed a bank with a staggering 1,500 different retail products.
Political infighting among four-member coalition underscores the need for structural reforms and perhaps a new government.The Standard & Poor’s downgrade of Italian debt to AA- is long overdue. The only wonder is that the other rating agencies have yet to jump on board.