BRUSSELS, Feb. 8 (UPI) -- The European Commission called on Italy's central bank Tuesday to declare a public commitment to be "open and competitive" and not exclude foreign banks.
The Financial Times reported European Union Internal Market Commissioner Charlie McGreevy sent a letter to Antonio Fazio, governor of the Bank of Italy, expressing concerns over the bank's policy in regards to the lack of "foreign participation in the Italian banking sector."
"EU...law does not provide supervisory authorities with the option of denying an authorization to acquire a major shareholding only based on the nationality of the applicant," McGreevy's letter stated.
"I would therefore be very grateful if you could correct the impression that has been generated by recent press reports, in order to assure market participants that the Italian authorities do not maintain any indefensible obstacles to foreign participation in the Italian banking sector."
As governor of the central bank, Fazio can block foreign banks from purchasing or raising a stake in Italian institutions. He also has the power to prohibit foreign transactions, which would destabilize the bank's financial situation. However some foreign banks suspect that Italy's bank has been deliberately avoiding foreign competition.
