Monte dei Paschi: Shaken to its foundations

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Huge sums of money lost, hidden contracts found, people in power because of privilege rather than professionalism, undue political influence and even death. No, it’s not the latest scandal from the Vatican, but the Monte dei Paschi drama. And now the spotlight is falling on the wider implications of its near-fall – not least, the ownership and board structure of many of Italy’s leading banks.

Through late May and early June last year, an intriguing document suddenly appeared in the inboxes of those who make their living absorbed by the baffling intricacies of Italian banking.

The paper was a challenge to anyone with a dodgy internet connection, a chunky 10 megabyte PDF file spread over 151 pages. When printed, it was about as big as a medium-sized book, not quite a felled forest but rather more than a casual weekend read for those who received it.

It read almost as if it was an excellent piece of fact-based journalism – impeccably detailed and referenced to clear inside sources and informants. The report wasn’t journalism, but what would prove to be a prescient research paper from two London-based Italian analysts, Andrea Filtri and Antonio Guglielmi from Italy’s biggest investment bank, Mediobanca.

The Mediobanca paper painstakingly documented what many observers of the Italian banking...