Abstract

The banking industry has shown in the last ten years an impressive process of consolidation all over the world. Competition in banking is structurally weak due to switching costs and asymmetric information problems. These later, moreover, make it harder for a bank to enter a new market by competing for the clientele of the incumbents. Acquiring an existing bank and its informational capital can be a more feasible alternative. Hence, takeovers can represent an important competitive tool in banking, mainly when the raider is a new (e.g. foreign) subject and not one of the incumbents. Problems of transparency and accountability characterize the legal framework on this issue in Italy. A desirable solution should separate the role of the Bank of Italy, responsible for the evaluation of the stability issues in bank takeover projects, from that of the Antitrust Authority, in charge for competition policy issues of the projects. Finally, the takeover projects approved under both criteria should be run under the supervision of the capital market regulator.