August 9, 2018 / 1:35 PM / 3 months ago

Italy court overturns market regulator's fines on Banca Etruria

MILAN, Aug 9 (Reuters) - An Italian court has overturned fines that market regulator Consob slapped on officials working for regional lender Banca Etruria last year for insufficient disclosure in a 2013 cash call prospectus.

In a ruling seen by Reuters, the court said Consob had been fully aware of the difficulty Banca Etruria was in when it cleared the prospectus for the capital increase aimed at shoring up the bank’s capital.

Banca Etruria was one of four small banks Italy saved from bankruptcy late in 2015. It was eventually bought by UBI Banca .

Consob originally fined the former auditors and administrators of Banca Etruria, claiming it had only been informed in 2016 of three important documents from the Bank of Italy regarding the state of the lender’s financial health.

But in its ruling the court said the watchdog had already known about at least two of the most important documents at the end of 2013. Those documents spell out how Banca Etruria was not able to restructure operations by itself and needed to be rescued, the court added in the ruling.

Consob declined to comment. (Reporting by Ilaria Polleschi Writing by Stephen Jewkes Editing by David Holmes)

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