How can a western government still support the creation of a banking monopoly? [closed]
The bank Monte dei Paschi di Siena was bailed out by the Bank of Italy in 2013 and the Italian state has indirectly been the majority shareholder since. Now talks are going on for the sale of the bank or part of it to the biggest Italian bank: UniCredit bank. These talks also involve the Italian government.
The problem is that the bank being sold is the fourth largest retail bank in the country and it was already considered too big to fail in 2013. The purchasing bank, Unicredit, not only is the biggest one in Italy, but in many areas of the country it has a near monopoly. However, looking around in the media, declarations by Union members, politicians, economists or journalists, nobody finds anything wrong with it. The issue has been dismissed by a curtain of silence.
How can the government allow such a deal? Especially a government that is headed by the former head of the European Central Bank, Mario Draghi, certainly he understands the impact of such action, but he raised no issues regarding systemic risks and dangers for the consumers choice.
Note: some comments state that my question is not clear. Since I could not find anywhere a comment released by a government official telling the official opinion on the issues of systemic risks and consumer choice I am asking if I missed something. I am asking if any source related to the Italian government or the Bank of Italy addressed such question or provided any explanation.
I am aware that the Central European Bank and sometimes its former head encouraged the European banks to merge across the borders to reach a bigger size on international levels.
However a small size at international level and a dominant position in a small area are two completely different issues. All the declarations and policies mentioned in the posted answer refer to the first issue, they have absolutely nothing to do with the creation of local monopolies. Thefore the answers posted by Fizz and JJJ do not answer my question. Furthermore, the banking group that could come out of this government sponsored merger, beyond having an excessive weight in some areas, would control close to 20% of the entire Italian market. Such a concentration of power did not raise any concern and although Fizz claims the opposite Mario Draghi did not make any comment about it. Nor the ECB express any opinion on the issue, let alone the Bank of Italy.
I asked why everybody is turning a blind eye on the argument and this question as of now is unanswered even if two answers were posted.