The governor of the Bank of Italy, Antonio Fazio, resigned on Monday, nearly five months after becoming involved in a scandal over an alleged attempt to stop a foreign bank taking over an Italian one.
Among names mentioned as possible successors were Mario Monti, Italy's former European commissioner; Tommaso Padoa-Schioppa, an ex-board member of the European Central Bank, and Mario Draghi and Vittorio Grilli, past and present director generals of Italy's treasury.
Fazio, 69, faced the threat of legal action before he finally stood down. The markets saw his departure as clearing the way for takeovers in Italy's fragile financial sector, sharply lifting shares of banks quoted on the Milan bourse. Banca Popolare Italiana, the bank in the takeover controversy, rose more than 4 percent. Of the rest, Capitalia led with a gain of almost 2.5 percent.
The central bank said Fazio had stepped down "with a clear conscience ... to restore calm in the higher interests of the country and the Bank of Italy."
The governor denied any wrongdoing in the fight for Italy's ninth-largest lender, Banca Antonveneta.
A bid by the Dutch bank ABN Amro was contested by Banca Popolare Italiana despite the Italian contender's evident under-capitalization.
Last July, an Italian newspaper published transcripts of a telephone call intercepted by prosecutors in which Fazio tipped off Banca Popolare Italiana's chief executive, Gianpiero Fiorani, that his counter-bid had been approved.
Fazio was quoted fixing a secret meeting with Fiorani at the Bank of Italy, telling him to "come in, as usual, by the back door."
The center-left leader Francesco Rutelli and other politicians called for Fazio to step down. But his life tenure of the post made it theoretically impossible for him to be removed until the government hinted that it would amend legislation before parliament to secure his removal.
Last week, however, Fiorani was arrested and jailed on suspicion of embezzlement. It emerged Fazio was also being investigated for suspected insider trading.
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