The Banca d’Italia is the Central Bank of Italy. It was established in 1893 and throughout its lifecycle, the Central Bank of Italy modified and amended its position to the flexible but applicable standards. The public institution derives its mandate from national law and European legislation. The latter is justified by its participation in the Eurosystem and membership of the European Union. Together with the other central banks in the European Economic Area, the Banca d’Italia aims to ensure an equal level playing field and maintain price stability throughout the member states and their shared currency.
Supervision of the banking sector and broader financial industry is considered the overall task of the Central Bank of Italy. The objective is to ensure the stability ad efficiency of the system and compliance to rules and regulations. The central bank pursues these objectives through secondary legislation, controls and cooperation with governmental authorities. Reformations of the authority resulted in formal corporate separation and independence while its monopoly position to the credit sector got loosened and is now shared with the antitrust authority, the Autorita Garante della Concurrenza e del Mercato.
Central Banks have always provided an important position in domestic policy making and controling the local financial system. The Italian central bank has acted as a bank of the banks by managing the monetary policy of the country while acting as a lender of last resort for troubled financial institutions. Over the years, several rescue missions of financial institutions in distress were initiated in the public interest. The Subsidy Consortium was initially transformed into a Liquidation Institute, and later taken over by the independent Institute for Industrial Reconstruction. Sector wide safeguards, investor protection and deposit insurance programs were established. The Fondo Interbancario di Tutela deo Depositi (FITD) is considered the Italian Deposit Guarantee Fund, where cooperative banks employ the Fundo di Garanzia dei Depositanti del Credito Cooperativo, and asset management firms use the Fondo Nazionale di Garanzia.
Banks and other financial institutions have always played an important role in the Italian economy as intermediaries for investment and borrowing. Local banks attracted large groups of savers whilst national banks retained low-risk loans from these local banks. Meanwhile monetary policy focused on stability for development.
The Central Bank of Italy is the competent national authority where it comes to supervision and resolution. Systemically Important Financial Institutions (SIFI) are monitored jointly with the European Central Bank (ECB). Accreditation to operate of financial institutions can therefore be withdrawn by both the Banca d’Italia as well as the ECB. Resolution aims to restructure the operation of the financial institution and maintain public confidence. Such is enabled by the FITD and its ‘Voluntary Scheme’ that allows financial institutions in distress with alternative support alongside the lender of last resort supported by the Central Bank.
Central Bank of Italy
via Nazionale 91
Phone: +39 06 47921