November 20, 2019 / 3:42 PM / 20 days ago

Bank of Italy Visco has no negative opinion on ESM reform-cenbank source

FILE PHOTO: Bank of Italy Governor Ignazio Visco speaks during a meeting in Rome, Italy, October 31, 2017. REUTERS/Remo Casilli

ROME (Reuters) - Bank of Italy governor Ignazio Visco’s recent comments about the European Stability Mechanism (ESM) did not indicate a negative opinion about planned reforms of the eurozone bailout fund, a source at the Italian central bank said on Wednesday.

Last week Visco said that some proposals carried risks that needed to be carefully considered.

The planned reform of the fund has fuelled a political storm in Italy, where opposition parties have accused the government of secretly negotiating a deal that could leave Italy exposed to a restructuring of its government debt.

The Bank of Italy source said that the ESM reform does not announce or envisage a mechanism for restructuring sovereign debt. Visco’s warning concerned the potential future working of the ESM in the absence of an overall reform of eurozone economic governance.

Reporting by Stefano Bernabei

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