EN  ECB -PUBLIC  
 
 
OPINION OF THE EUROPEAN CENTRAL BANK  
of 21  February  2014  
on changes in the governance of the Banca d’Italia  
(CON/2014 /19) 
 
Introduction and legal basis  
On 6 December 2013 , a request for an opinion was sent by the Banca d’Italia to the European Central 
Bank  (ECB) regarding amendments  to the Statute of the Banca d’Italia  (hereinafter the ‘amend ments ’). 
The amendments  implement the principles laid down in Decree -Law No 133 of 30 November 2013 
(hereinafter the ‘Decree -Law’) and address elements of the Banca d’I talia’s capital and governance . 
The ECB’s competence to deliver an opinion is based on Articles 127(4) and 282(5) of the Treaty on 
the Functioning of the European Union  and the third indent of Article  2(1) of Council 
Decision  98/415/EC of 29  June 1998 on t he consultation of the European Central Bank by national 
authorities regarding draft legislative provisions1, as the amendments  relate  to the Banca d’Italia. In 
accordance with the first sentence of Article  17.5 of the Rules of Procedure of the European Ce ntral 
Bank, the Governing Council has adopted this opinion.  
 
1. Purpose of the amend ments   
1.1 The Decree -Law provid es for a n increase of the Banca d’Italia ’s capital  and lay s down principles 
for the amendments ; the ECB issued Opinion CON/2013/962 on the D ecree -Law. Following the 
adoption of the Decree -Law, a n extraordinary meeting of the Banca d’Italia’s shareholders 
approved the amendments on 23 December  2013 , in accordance with the procedure for amend ing 
the Statute of the Banca d’Italia3. This procedure  was completed by the transposition of the 
amendments by means of the  Presidential Decree of 27 December 2013 . 
1.2 The amendments include provisions on the Banca d’Italia’s capital,  in accordance with the Decree -
Law. The Banca d’Italia’s share capital, set  by the Banking Law of 1936 at EUR  156 000, is raised  
to EUR 7.5 billion4 pursuant to the Decree -Law and the amendments. The range of eligible 
                                                           
1  OJ L 189, 3.7.1998, p. 42 .  
2  All ECB Opinions are published on the ECB’s website at www.ecb.europa.eu.  
3  In accordance with Article 10(2) of Legislative Decree No 43 of 10 March 1998, referred to in Article 6(5) of the 
Decree -Law, whereby the amendments to the Statute  of the Ba nca d’Italia , once approved by the assembly of 
shareholders of the Banca d’Italia are finally adopted by means of a Presidential Decree, adopted on a proposal by the 
President of the Council of Ministers acting together with the Ministry of the Treasury, t he Budget and Economic 
Planning.  
4  See Article 3 of the Statute  of the Banca d’Italia . 
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2 shareholders is not defined by the Statute of the Banca d’Italia  which, in this respect, refers to 
applicable law , i.e. Article 4(4) of the Decree -Law. The Decree -Law has been converted  into Law 
No 5 of 29 January 20145 (hereinafter the ‘Law’) . In the process of conversion , the Italian 
Parliament made changes   to the Decree -Law to the effect that only the following i nstitutions are 
allowed to hold shares : (a) banks, insurance and reinsurance enterprises having their registered and 
head office s in Italy ; (b) banking foundations established under Arti cle 27 of Legislative Decree 
No 153 of 17 January 1999 ; and (c) Italia n welfare institutions and pension funds established under 
Article 4(1) of the Legislative Decree No 252 of 5 December 2005 . The amendments also make 
reference to  the cap on voting rights exceeding the threshold  of the Banca d’Italia’s share capital : 
share s exceeding s uch threshold  must  accordingly  be disposed of by the time limit set by the Board 
of Directors , with related dividends attributed to the statutory reserves6. In accordance with the 
Law, the amendments also enable the Banca d’Italia to  buy back its own  shares from shareholders 
and temporarily hold them , in order to foster compliance with the limit imposed on individual 
shareholdings . 
1.3 The amendments also transpose the provisions introduced by the Law  on the economic rights 
attached to the shar es of the Banca d’Italia capital  in the Statute of the Banca d’Italia . Such 
economic rights consist of: (a) the value of the shares themselves ; and ( b) the  annual dividend  
distribution s. The maximum amount of dividends that can be distributed  to shareholde rs from  the 
net profit of the Banca d’Italia is capped to six per cent of its capital. Further p ay-outs to 
shareholders from  reserves, formerly granted by Article 40,  are to be  excluded7 in future . 
1.4 The amendments also include  changes to the Banca d’Ita lia’s governance. In particular , the 
minimum percentage shareholding required to call a meeting of shareholders8, to set the agenda9 
and to exercise voting rights10 are increased . The quorum  for meetings  is also increased11. In 
addition, p ursuant to Article 5(2) of the Law, amended Article 1 6 lays down specific 
requirements of independence, integrity and experience for the members of the Board of 
Directors . These requirements are  also applicable to auditors, councillors and regents12. 
Moreover , the Governing B oard is entrusted with decision -making power s in tasks related to the 
European System of Central Banks (ESCB) , without prejudice to the powers and duties reserved 
to the Governor as a member of the ECB’s decision -making bodies13. 
                                                           
5  See Law No 5 of 29 January 2014 , published in the Gazzetta Ufficiale della Repubblica Italiana  No 23, 29.01.2014.  
The ECB was not consulted o n the amendments to the Decree -Law.  
6  See Article 3(4) of the Statute  of the Banca d’Italia . It should however be noted that, in line with Article 6(5)(c) of 
Law No 5 of 29 January 2014 , for an interim period lasting no longer than 36 months starting from completion of 
capital i ncrease, shares exceeding the 3% threshold shall not bestow voting rights but shall attribute related dividends.  
7  See Article 6(5)(b) of Law No 5 of 29 January 2014 . 
8  Article 6 (3) of the Statute  of the Banca d’ Italia. 
9  Article 7(2) of the Statute  of the Banca d’Italia . 
10  Article 9 (1) of the Statute  of the Banca d’Italia . 
11  Article 10(1) of the Statute of the Banca d’Italia.  
12  Article 20(2), 28(2) and 31(1) of the Statute of the Banca d’Italia.  
13  Articles 2 2 and 2 5 of the Statute of  the Banca d’Ita lia. 
ECB -PUBLIC  
3  
2. The appropriate time to  consult the ECB  
The request for an opinion on the draft amendments was sent by the Banca d’Italia on 
6 December  2013. The request stated that the Board of Directors’ meeting had been convened for 
20 December 2013. The amendments were approved by the share holders’ extraordinary meeting on 
23 December 2013 and then transposed by means of a Presidential Decree on 27 December 2013  
published in the Gazzetta Ufficiale  on 31  December 2013 and taking effect from the same date . In 
accordance with Article 3(4) of De cision 98/415/EC , the process of adoption of the amended Statute  of 
the Banca d’Italia  should have been suspended pending submission of the ECB’s opinion. The ECB 
would like to draw the attention of the national  authorit ies to the proper pro cedure for cons ultation.  
 
3. General observations  
3.1  The issues  of financial independence of the Banca d’ Italia and the necessity for the Banca 
d’Italia’s reserves to be gradually replenished over an appropriate period of time and up to the 
amount deemed necessary to s afeguard the value of the Banca d’Italia’s capital and assets  were  
specifically addressed  in Opinion CON/2013/96 . Such observations, insofar as relevant for the 
present purposes, also apply to the amendments . 
3.2  The ECB understands that buy -back operatio ns may be carried out by the Banca d’Italia in order 
to enable shareholders to comply with the limit  imposed on sharehold ings and that contracts to 
this effect may be entered into by the Banca d’Italia . Situations , limits, procedures and conditions 
will be  specified by the Banca d’Italia ’s Board of Directors in agreement with its Board of 
Auditors . The ECB observes that, i n doing so , the Board of Directors will take as a point of 
reference the safeguard of the Banca d’ Italia’s capital and that the purchase price may not exceed 
the nominal value of the shares. The ECB also notes that the voting rights of the shares  subject to 
the buy -back  will be suspended . Such shares will be computed for the purpose of duly 
constituting the shareholders’ meeting , whereas th ey will not be taken into account  in the 
calculation of majorities required to approve resolutions.  
3.3  In view of the foregoing considerations,  the ECB understands that the Banca d’Italia will decide 
on such buy -back operations prudently and with due re gard to its own financial considerations.  
3.4  The ECB notes that, pursuant to Article 3(6)  of the Statute of the Banca d’Italia , the buying and 
selling of transactions shall  be carried out in accordance with the principle of transparency and 
equal treatme nt of potentially interested parties . It is for the Commission to assess whether the  
amendments that the Italian legislator made to the Decree -Law, imposing a nationality 
requirement with regard to  shareholders , comply with European Union law . 
 
ECB -PUBLIC  
4 4.  Institutional and f inancial independence  
4.1 Financial independence , which is an aspect of the principle of central bank independence referred 
to in Article 130 of the Treaty,  concerns , inter alia , the profit allocation rules of a  national 
central bank  (NCB ). An NCB’s statute may prescribe how its profits are to be allocated. In the 
absence of such provisions, decisions on the allocation of profits should be taken by the NCB’s 
decision -making bodies on professional grounds, and should not be subject to the discret ion of 
third parties unless there is an express safeguard clause stating that this is without prejudice to 
the financial means necessary for carrying out the NCB’s ESCB -related tasks as well as national 
tasks14. 
4.2 In particular , Article 7 of the Statute  of the Banca d’Italia  provides for the power of the 
shareholders to approve the allocation of the net profits  in accordance with p rofit allocation rules 
laid down  in the  amended Article 40. These rules provide that the allocation of net profits is 
determine d by the Board of Directors acting on a proposal from the Governing Board following 
consultation with  the Board of Auditors , and is to be  presented for  approval at the shareholders’ 
meeting . Net profits are distributed to : (a) ordinary reserves up to 20  per cent of net profits ; 
(b) shareholders up to 6 per cent of the capital ; (c) extraordinary  reserves and provisions up to a 
maximum of 20 per cent of net profits ; and (d) the State for the remaining sum. The ECB 
understands  that, should the ordinary reserve s be reduced  to offset losses, net profit s will be 
allocated to the ordinary reserves until the ordinary reserves are replenished15. As consistently 
noted by the ECB16, profits may be distributed to the State budget only after any accumulated 
losses from pre vious years have been covered , and financial provisions deemed necessary to 
safeguard the real value of the NCB’s capital and assets have been created. The ECB takes note 
of Article 40(3)  of the Statute of the Banca d’Italia , which lays down general princi ples on the 
replenishment of ordinary reserves , and expect s the Banca d’Italia to interpret these principles 
adequately, in accordance  with the principle of financial independence . In addition,  the ECB 
understands that a provision for general risks shall c over the risks deriving from the overall 
operations of the Banca d’Italia, and that this provision shall be funded taking into account the 
general risk level17. 
4.3 The ECB  also welcomes the amendment to Article 6  of the Statute of the Banca d’Italia , which  
requires that the shareholders ’ meeting does not interfere in any way with matters pertaining to 
the exercise of ESCB -related tasks , and understands that this provision reaffirm s the Governor’s 
and the Governing Board’s exclusive competence on matters rel ated to the exercise of ESCB -
related tasks . 
 
                                                           
14  See the ECB’s Convergence Report 2013, p. 26 . 
15  Article 40(3) of the Statute  of the Banca d’Italia . 
16  See the ECB’s Convergence Report  2013, p. 25 . 
17  Article 41(2) of the Statute  of the Banca d’Italia . 
ECB -PUBLIC  
5 5.  Personal independence  
5.1 As regards conflicts of interest, the ECB note s in its Convergence Reports that , as a matter of 
principle, membership of a decision -making body involved in the performance of ESCB -related 
tasks is incompatible with the exercise of other functions that might create a conflict of interest. 
In particular, members of such decision -making bodies may not hold an office or have an interest 
that may influence their activities, whether throug h office in the executive or legislative branches 
of the state or in regional or local administrations, or through involvement in a business 
organisation. The ECB welcomes the reference made in Article 4 3 of the Statute  of the Banca 
d’Italia  to the code s of ethics  applicable to staff members and the members o f the Governing 
Board , which  lays down general principles on independence and impartiality, ceilings on the 
acceptance of gifts, conflicts of interest, confidentiality and continuance of duties after ce ssation 
of employment . 
5.2 Article 1 8 of the Statute of the Banca d’Italia  contains an explicit provision concerning the 
grounds for dismissal of members of the Governing Board , other than the Governor , by reference 
to Article 14.2 of the Statute  of the Eu ropean System of Central Banks and of the European 
Central Bank . The members of the Governing Board , other than the Governor , must have the 
right to submit any decision to dismiss them to an independent court of law, in order to limit the 
potential for pol itical discretion in evaluating the grounds for their dismissal. The ECB 
understands that this right is made available under Italian law on the basis of overriding 
principles of constitutional law and relevant procedural rules. However, for reasons of legal 
certainty , it would be advisable to refer to such a right of review  in the Statute of the Banca 
d’Italia18. 
 
6.  Independence of the Banca d’Italia for prudent ial supervision  
The ECB also understands that the amendment to Article 6 of the Statute of the Banca d’Italia , by 
requiring that the shareholders ’ meeting does not interfere in any way with the matters relating to the 
exercise of the public functions entrusted to the Banca d’Italia by Union law, would also encompass the 
future performance of the B anca d’Italia’s  supervisory tasks, including future tasks related to the Single  
                                                           
18 See for example the ECB’s Convergence Rep ort 2013 p. 24.  
ECB -PUBLIC  
6 Supervisory Mechanism (SSM) , and thus be in accordance  with the principle of independence of 
supervisors19, and the requirement for national competent authorities to act independe ntly within the 
SSM, as enshrined in Article 19 of Council Regulation No. 1024/201320. 
 
This opinion will be published on the ECB’s website.  
 
 
Done at Frankfurt am Main, 21 February 2014 . 
 
[signed]  
 
The President of the ECB  
Mario DRAGHI  
                                                           
19 See Principle 2 of the Core Principles for Effective Banking Supervision. See also paragraph 5.3 of Opinion 
CON/2013/71.  
20 Council Regulation (EU) No  1024/2013 of 15  October 2013 conferring specific tasks on the European Central Bank 
conc erning policies relating to the prudential supervision of credit institutions  (OJ L 287, 29.10.2013, p. 63 ).