La Consob asks Parliament to review the bail-in policy, the new bank rescue mechanism which provides for the contribution of shareholders, bondholders and current account holders (but only for deposits over 100 thousand euros). The outline of the legislative decree being examined by Parliament "is in contrast with the Community directive on market abuse", Giuseppe Vegas, number one of the body that supervises the Stock Exchange, said this morning before the Senate Finance Committee.
The central problem is that, with this measure, Consob would initially be unaware of a possible bail-in procedure against a listed bank and that would prevent her from countering the risk of insider trading (criminal offense which consists in taking advantage of the market from information that is not yet public).
According to Vegas, then, there is a contradiction between the market abuse directive, which requires the immediate disclosure of any price sensitive information to the public, and the text under examination by Parliament (in implementation of the European delegation law approved last July), which instead would impose an automatic delay in the dissemination of information, risking damaging "investors who purchase financial instruments of the bank at a price that does not reflect the news on the state of instability of the bank or investment firm".
Consequently, the President of the Commission asks an amendment to the decree which obliges the Bank of Italy to promptly communicate the measures to Consob taken and not yet public, also because the risk of "fueling legal disputes and claims for compensation" by investors who may be penalized by an "incomplete or misleading" information framework should not be underestimated.
Two days ago the Deputy Director General of the Bank of Italy, Fabio Panetta, had said before the Palazzo Madama commission that the bail-in "must constitute an extrema ratio, a possible but hopefully remote hypothesis" and "to this end it is essential that the regulatory framework creates the conditions for banking to take place in a sound and prudent manner and the supervision is effective, capable of promptly intercepting and correcting critical situations, avoiding a state of instability".
On the other hand, second the chairman of the management board of Intesa San Paolo, Gian Maria Gros Pietro, the scheme of the decree revises the hierarchy of creditors, subordinating senior bonds to interbank and corporate deposits: this "makes funding in senior bonds more expensive for Italian banks, which would be penalized compared to those of other European countries, with a consequent increase of the cost of financing the real economy”.
MPS, VEGAS: WE'VE BEEN EVALUATING NEW FACTS ON BUDGET SINCE 2012
On the sidelines of today's hearing, Vegas also announced that Consob is "evaluating" whether to challenge the 2012 financial statements of Monte dei Paschi di Siena for the representation of Alexandria, indicated as open balances instead of as a derivative, as in reality was: "New facts have emerged," he said, referring to the elements that emerged in the trial opened in Milan last week. In the viewfinder is the operation with Nomura carried out by the old management of the Bank and Consob has asked to appear as a civil party.
