Bank of Italy Seen Vigilant as Monte Paschi Risk Surfaced

The Bank of Italy acted vigilantly in its oversight of Banca Monte dei Paschi di Siena SpA, with the discovery of accounting irregularities leading to a criminal investigation targeting previous management, a former senior Bank of Italy official who was involved in the inspections said.

Pressure from the central bank prompted a shakeup of executives at the Siena-based lender last year and led to the uncovering in January of secret documents about some transactions hidden from regulators, said the person, who asked not to be identified because the probe is confidential.