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Last Updated: Friday, 23 September 2005, 09:24 GMT 10:24 UK
Italy bank boss defies Berlusconi
Antonio Fazio
Antonio Fazio has become a divisive figure in Italian politics
Embattled Italian central bank governor Antonio Fazio has gone ahead with a visit to Washington, despite a call by the prime minister for him to resign.

Mr Fazio flew to the US for the World Bank and International Monetary Fund's annual meeting this weekend.

On Thursday night, Silvio Berlusconi said he hoped Mr Fazio would resign over allegations that he tried to block a Dutch bank's takeover bid.

Italy's economy minister has resigned in protest at Mr Fazio's failure to go.

Deputy prime minister Giulio Tremonti replaced Domenico Siniscalco - an outspoken critic of the Bank of Italy governor - when he quit his post as economy minister on Thursday.

Mr Tremonti, who is also in Washington this weekend, told the Corriere della Sera newspaper that he would ignore Mr Fazio completely.

Mr Fazio was questioned by reporters on his arrival in Washington, but declined to make any comment.


Mr Fazio is at the centre of controversy over his role in the struggle for control of Banca Antonveneta, which pitted Italy's Banca Popolare Italiana against Dutch bank ABN Amro.

The central bank approved Banca Popolare Italiana's takeover offer for its Italian rival.

However, the bid was later suspended and Banca Popolare's chief executive Gianpiero Fiorani was forced to resign following allegations of insider trading.

Domenico Siniscalco
Mr Siniscalco was worried about the Bank of Italy's standing

Details of leaked conversations revealed that Mr Fazio had tipped Mr Fiorani off about the Bank of Italy's decision to clear the bid.

On Thursday Mr Berlusconi added his voice to the chorus of Italian politicians calling for Mr Fazio to resign, saying his presence was "not compatible with national credibility".

His intervention followed concern that the Bank of Italy's international standing had been damaged by the allegations of bias in its handling of the takeover battle.

The Italian government recently announced plans to reform the central bank but refused to force the departure of Mr Fazio, who has denied any wrongdoing.

Mr Fazio, who was appointed for life, has been staunchly supported by the Northern League, one of Mr Berlusconi's coalition partners.

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