How can a western government still support the creation of a banking monopoly?

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The Politicus
Aug 06, 2021 11:45 AM 0 Answers
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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.

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  • August 6, 2021