Italy


Do senior bank staff, including non-executive directors, have to be registered with your national regulatory authority?

Italian law does not provide for registration of the bank staff with the Italian regulatory authority.

However, pursuant to article 26 of the D.lgs. 1/09/93 (Testo Unico Bancario) (TUB), as further implemented by the Ministerial Decree 161/1998 (the Decree), people with management and monitoring powers/authority at banks have to satisfy a number of requirements concerning professional competence and experience, integrity and independence, which must be verified by the bank’s board of directors. A copy of the minutes of the board meeting in which the verification took place, along with the relevant documentation attesting to the satisfaction of the requirements, have to be delivered to the Bank of Italy.

The Decree provides for the description of such requirements and the list of the documentation to be verified by the board of directors.

In particular, pursuant to the Decree, directors, the chairman of the board of directors and managing directors of a bank have to satisfy specific “professional requirements” (requisiti di professionalità) by proving competence in management and oversight (based on previous experience of at least 3 to 5 years, depending on the role) in the credit, finance, insurance and banking markets and suitability to carry out a responsible management and leadership role in the bank.

In addition, “integrity/probity requirements” (requisiti di onorabilità) must also be satisfied. In particular, responsible management roles may not be held by people:

  1. who have been subject to preventative measures issued by judicial authorities; that is, measures applied to people who have previously committed criminal offences to safeguard against the risk of further criminal offences being committed by them, pursuant to specific laws; or
  2. who have been subject a to binding and final judgment providing for imprisonment of at least one year or two years; or
  3. who have been declared bankrupt or interdicted from any public role.

If the above requirements are not fulfilled, upon appointment or even afterwards, the board of directors, or, in the case of delay, the Bank of Italy, has to resolve to suspend the manager involved.

If your national regulatory authority requires registration of senior bank staff what are the requirements?

Italian law does not provide for registration of the bank staff with the Italian regulatory authority.

Pursuant to article 26 of the D.lgs. 1/09/93 (Testo Unico Bancario) (TUB), as recently amended by the Legislative Decree 12/05/15 no. 72 (the Legislative Decree) which has implemented the Directive 2013/36/EU (CRD IV), people with management, monitoring and administrative powers/authority in a bank have to satisfy a number of requirements concerning professional competence and experience, integrity, fairness and independence, to ensure safe and prudent management of the bank. The bank’s board of directors must verify the compliance to such criteria by its members.

If the above requirements are not fulfilled, upon appointment or even afterwards, the board of directors, or, in the case of delay, the Bank of Italy, has to resolve for the suspension of the manager involved.

The Legislative Decree shall be further implemented by a decree to be issued by the Economy and Finance Ministry (Ministero dell’Economia e delle Finanze). In particular, the forthcoming decree will specify in more detail the requirements above and the limits to the number of roles and position that can be covered by a single individual.

Is there legislation specific to the banking sector that provides for penalties to be levied against senior staff for mis-managing a bank?

As part of its supervisory activity and as a result of it, Bank of Italy has the power to levy monetary administrative sanctions against senior staff and responsible managers of a bank. TUB provides for the sanctions procedure and the relevant monetary penalties or interdiction measures.

Articles 52 bis and ter of the TUB provide for a specific mechanism of reporting violations, both internally and to Bank of Italy.

In order to establish the amount of a monetary penalty and/or the duration of an interdiction measure, Bank of Italy takes into account, among the other, the following criteria:

  • relevance and duration of the violation;
  • level of responsibility;
  • advantage obtained or losses avoided through the violation;
  • any damages caused to third parties;
  • previous violations in the banking and finance sector.

What is the maximum amount the regulator can fine an individual?

TUB currently provides for monetary penalties for an individual up to an amount of around Euro 5 million. In case the profit obtained by the individual through the violations is higher than 5 million, the penalty may be increased up to twice the advantage obtained. Furthermore, depending on the violations, Bank of Italy may resolve for the interdiction of the individual from any management, monitoring and administrative role for a period up to three years.

Is there legislation in place that requires banks to have in place remuneration policies and practices that are consistent with effective risk management?

Bank of Italy provides guidelines for banks, based on European directives in force and international best practice, with the aim to implement internal remunerations policies in line with long term strategies and business targets, linked to business results.

Is there any legislation planned in your jurisdiction that will strengthen the accountability of senior bank staff?

The Legislative Decree came into force at the end of June 2015. An additional Ministerial decree shall be issued to further implement some of its provisions. Such decree shall take into consideration the ECB Guide to Fit and Proper Assessment issued in May 2017.