CERNOBBIO, Italy Italy's Prime Minister Matteo Renzi said on Friday he wanted banks in the country to merge and cut costs and hoped that Monte dei Paschi di Siena (BMPS.MI) carries out a vital 5 billion euro ($5.6 billion) cash call this year.
Monte dei Paschi, the country's third-largest bank, has long been seen as the weakest link in a troubled banking system that has come to pose a major challenge to the Renzi government.
A string of bank crises, following a harsh recession that bankrupted thousands of small businesses, has left many ordinary Italians out of pocket and hurt confidence in lenders.
"I hope the capital increase of Monte dei Paschi can be carried out by the end of the year and, above all, that the strong message we sent with the measures on mutual banks will be understood: banks must merge," Renzi said in a speech at the Ambrosetti forum.
"In Italy there are more bank executive jobs and branches than in the rest of the world, that's not good."
($1 = 0.8945 euros)
(Reporting by Valentina Za)