Former headofItaly's BPI arrested in takeover probe

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Former headofItaly's BPI arrested in takeover probe

Former headofItaly's BPI arrested in takeover probe
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Italy’s financial police have reportedly been searching offices and residences of former Banca Popolare Italiana directors and managers after the arrest of the bank’s former chief executive Gianpiero Fiorani.

He and three former executives of the bank are being held on charges of market manipulation, embezzlement and criminal association, according to prosecution sources.

The investigation centres on the bank’s attempt to buy its larger competitor Banca Antonveneta, to stave off a takeover by Dutch lender ABN-Amro.

Fiorani’s arrest came on the same day European Union regulators launched legal proceedings against Italy over the way its central bank has handled foreign bids for Italian financial institutions.

The governor of the Bank of Italy, Antonio Fazio, is a close friend of Fiorani’s.

Asked about the arrest Fazio told the newspaper Corriere della Sera: “My conscience is clear, I have always applied the law correctly. If Fiorani has done something illicit, we have nothing to do with it.”

The EU probe was launched after ABN-Amro complained the Bank of Italy had tried to block its bid for Antonveneta.

Fazio approved Pop Italiana’s rival bid, then placed a late-night phone call to Fiorani to tell the banker it had been approved.

That led to accusations the central banker had unfairly favored the Italian bank over its Dutch rival.

Fazio has resisted pressure for him to resign.