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MNI (London)
--Bank Of Italy's Visco, Panetta Seen As Leading Candidates
     LONDON(MNI) - Italy is confident it will get a seat on the European Central
Bank's Executive Board when Benoit Coeure steps down in December, maintaining
their 'Big Four' representation following the departure of current President
Mario Draghi in October, sources told MNI.
     France's Christine Lagarde will replace Draghi from November 1, leaving
Italy without representation on the ECB's board and Rome believes they, as one
of the bank's biggest stakeholders and the third-largest Eurozone economy,
should be represented "by right" and the Market Operation department currently
run by Coeure would be an acceptable position.
     Rome's Council of Ministers, chaired by Prime Minister Giuseppe Conte, will
nominate an appointment in coming months, with a monetary policy expert expected
to be put in place. The nominee will then be approved (or not) by the European
Council after consultation with the European Parliament and the ECB Governing
     Italy feels it has at least two highly qualified candidates and MNI
understands that current Bank of Italy governor Ignazio Visco and his
second-in-command, senior deputy governor Fabio Panetta are to the fore,
although sources at the Bank accept there is no written rule guaranteeing them
the spot.
     But Rome's populist government, which has been at odds with the BOI in
recent months, pushing the Bank to better represent Italian interests, could
nominate an external, technocrat.
     Panetta was granted a second term earlier this year by the coalition
government, before being promoted to senior deputy governor in May. He also
chairs the BOI-supervised IVASS insurance authority. He is supported by both the
5 Stars Movement and the League party, who aim to reform and strengthen the ECB.
     As a member of the Single Supervisory Mechanism's Supervisory Board Panetta
has called for changes to EU rules on bailing-in bondholders at failing banks
and for easier timetables in reducing non-performing loans.
     Visco's mandate was renewed in October 2017 by the previous Democrat-led
cabinet and he might have fewer chances of being chosen by the government
compared to Panetta. He already sits in the Governing Council and BOI's
supervision of Italian banks on his watch have been repeatedly criticized by
both the League and 5 Stars.
     Another government source noted that Italy not to securing a board seat
when Coeure goes would be seen as "a negative move against Rome" at a tense
moment in time. There would be other opportunities to appoint an Italian when
Luxembourg's Yves Mersch' term ends in December 2020 and Germany's Sabine
Lautenschlaeger in January 2022, the source said, but "the sooner, the better".
--MNI London Bureau; tel: +44 203-586-2225; email:
[TOPICS: M$E$$$,M$I$$$,M$X$$$,MC$$$$,MX$$$$,M$$EC$]
MNI London Bureau | +44 203-865-3812 |