MILAN (Reuters) - The Bank of Italy "positively" fulfilled its supervision duties and is ready to account for its actions on failing lender Banca Popolare di Bari, Governor Ignazio Visco told Corriere della Sera daily in an interview published on Monday.
Prosecutors in the southern Italian town of Bari are investigating the former chairman of Popolare di Bari for alleged corruption in relation to the central bank's supervisory activity over the failing local lender, a judicial source said on Sunday.
"Banking supervision has accomplished its duties with the highest effort and, in my opinion, positively," Visco told Il Corriere, adding that Bank of Italy would still assess whether it had made mistakes.
"We are ready to account for our actions, as we have always done, at an institutional level," he said, referring to Popolare di Bari.
The issue has called into question the efficacy of the Bank of Italy's supervisory role, with the ruling 5-Star Movement calling for a reform of the appointment procedure of the central bank's top management.
Earlier this month the Bank of Italy put Popolare di Bari, the biggest lender in the poorer south of the country, under special administration and Rome has passed emergency measures worth up to 900 million euros ($997 million) to prop up to the unlisted cooperative bank.
Visco said that the rescue plan for Popolare di Bari - which involves a depositor guarantee fund financed by Italian banks (FITD) and state-owned Banca del Mezzogiorno-Mediocredito Centrale - aims at avoiding losses to depositors and bond holders.
But he suggested the bank's 69,000 shareholders, mostly retail investors, could book losses.
"The industrial plan will the define the amount needed for new capital, the way to carry it out and the involvement of current shareholders," Visco said.
($1 = 0.9024 euros)