The Bank of Italy said Tuesday it has conducted "intense oversight activities" into Banca Popolare di Vicenza (BPV) bank over the years. These include seven inspections over the past decade having to do with BPV's "finance, credit, transparency and anti money-laundering" practices, the central bank said.
President Giovanni Zonin was placed under investigation last month over alleged stock manipulation and obstruction of regulatory authorities at the medium-sized Italian lender.
The bank's former general manager, Samuele Sorato, is also being probed.
Finance police searched Banca Popolare di Vicenza offices in Milan, Rome and Palermo in relation to the probe by prosecutors in the northern city of Vicenza.
In recent weeks some account holders filed complaints to prosecutors, sources said.
Also in September, union sources said after meeting with bank management that BPV confirmed it is shutting down 150 branches, cutting 575 jobs, is trying to obtain a 1.5 billion euro capital increase. The bank forecast a return to profit in 2016 with gains of 200 million euros in 2018 and a 0.4% reduction in labor costs by 2020.
On Tuesday, the central bank said "several problems have been solved, which could not be disclosed to the public per current classified information regulations".
The Bank of Italy added that "for a time, it (the central bank) adopted restrictive measures against BPV with regards to its capital endowment and corporate structure".
As well, the central bank said that during a 2015 inspection carried out in agreement with the European Central Bank, it discovered BPV was financing the acquisition of its shares by certain shareholders without authorization, and also that it was calculating those transactions as part of its minimum capital requirements. This is against EU and Italian banking regulations, because banks are now required to have a certain amount of capital all times in order to absorb possible setbacks.
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