ROME Italian Prime Minister Matteo Renzi on Wednesday defeated two no-confidence motions brought by the opposition in parliament, which has accused the government of having a conflict of interest during the rescue of four small banks last year.
Renzi's Senate allies easily repulsed the no-confidence motions - brought separately by the anti-establishment 5-Star Movement and the centre-right opposition - that would have prompted the collapse of the government had they been lost.
The motions accused Renzi's government of having a conflict of interest because his 35-year-old reform ministerm Maria Elena Boschi, was linked to one of the saved lenders. She held some shares, and her father was on the board.
Boschi has always denied that her father's business activities influenced her or the government, and she survived a bid to oust her over the alleged conflict of interest last year in the Chamber of Deputies.
Speaking before the dual votes, Renzi rejected allegations that there had been any special treatment, and defended the government's work to keep afloat the four lenders - Banca delle Marche, Banca Popolare dell'Etruria (PEL.MI), Cassa di Risparmio di Ferrara and Cassa di Risparmio di Chieti.
"There was not a single act that could have made someone talk about a conflict of interest, not by minister Boschi and not by any member of the government," Renzi said during a fiery speech. The rescues "protected a million depositors and 7,000 salaries" of those who worked for the lenders, he added.
Managing the fallout that a three-year slump between 2012 and 2014 has had on the Italian banking system has been a constant concern for Renzi in recent months.
His government passed a landmark reform aimed at reducing the number of cooperative banks last year, and that was followed by the bank rescues at the end of 2015, while this week Italy reached a deal with the European Commission to help the banking system offload billions of euros in bad loans.
But the new cooperative bank rules have encountered resistance from some shareholders and local vested interests, while the bank rescues led to losses by some retail investors, and the suicide of at least one pensioner.
The opposition has jumped on the controversies surrounding the banks in an effort to further erode the popularity of Renzi's Democratic Party (PD).
Since the May 2014 European Parliament elections, the PD has slid in the polls to between 30-34 percent from more than 40 percent.
(Reporting by Steve Scherer; Editing by Isla Binnie/Mark Heinrich)
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Published Date: Jan 28, 2016 02:16 am | Updated Date: Jan 28, 2016 02:16 am