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BOI not aware of loss-making trades at Monte Paschi-Visco to Bloomberg
January 25, 2013 / 10:42 AM / 5 years ago

BOI not aware of loss-making trades at Monte Paschi-Visco to Bloomberg

MILAN, Jan 25 (Reuters) - The Bank of Italy governor Ignazio Visco said on Friday the central bank was not aware that certain risky business at Banca Monte dei Paschi di Siena was linked to loss-making financial operations.

“It has emerged that certain operations that were risky, the ones that had reduced liquidity at the bank, were actually connected with other operations which had losses we were not informed of,” Visco told Bloomberg TV in Davos.

Visco defended the way the central bank acted on Monte dei Paschi after the lender this week revealed structured trades that could cost it as much as 720 million euros.

“The Bank of Italy is a supervisor but is not the police of the banks. It acts in order to maintain the correct conduct of the banking system and we have been very present on that.”

In November Monte dei Paschi asked for 3.9 billion euros in state aid to plug a capital shortfall identified by the European Banking Authority requirements.

“We certainly will be available for accountability and all this, but this does put into question the stability of the bank,” he said, adding that the bank needs money because it needs to meet certain European standards of capital. (Reporting by Francesca Landini. Editing by Stephen Jewkes)

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