It began last year, when Milanese banking giant UniCredit angered Prime Minister Giorgia Meloni’s government by attempting to take over crosstown rival BPM, which Meloni had hoped to merge with the partially bailed-out Tuscan lender Monte dei Paschi di Siena. In response, Rome deployed screening tools known as the ‘golden power’ \u2014 whose purpose is to prevent malicious foreign investment \u2014 to impose tough conditions on the bid, which UniCredit claims has effectively blocked it, prompting a court battle that unfolded earlier this week.<\/p>\n
But more broadly, Rome’s strong-arming has also come into conflict with the grand industrial vision of the Commission, which has placed consolidating Europe’s still-fragmented banking market at the center of Europe’s new \u2014 and what it describes as an increasingly urgent \u2014 competitiveness drive. <\/strong>Commission officials are readying a warning to the Italian government on its misuse of golden power to hamper UniCredit’s bid for BPM. <\/p>\n At the annual assembly of the Association of Italian Banks (ABI) on Thursday, those tensions played out in real-time between financial officials and their industry counterparts \u2014 albeit in muted form.<\/p>\n On the surface, it was more like an infrequent gathering of a fractious family that wants to keep up appearances over festivities, and there was no explicit mention of the drama in public comments.<\/p>\n But on the industry and regulatory side, the speeches contained barely concealed paeans to free-market capitalism and the virtue of unmolested free markets. ABI Chairman Antonio Patuelli, a spry veteran of the scene, emphasized the importance of advancing the European banking union, calling for “common rules for corporate governance, markets, savings and investment.” <\/p>\n