	italy sets rules for company holdings in banks companies will henceforth be able to own stakes in banks but these should not constitute a dominant holding an italian government committee ruled the interministerial committee on credit and savings headed by treasury minister giovanni goria said its decision reflected the need to safeguard the principle of separation between banks and non financial concerns it did not quantify what might constitute a dominant holding the committee also set conditions for the allocation of credits by banks to companies or individuals holding stakes in them and stipulates conditions under which the bank of italy could exercise its powers of control in the case of stakes held by banks in companies or other banks under the ruling credits given by banks or their subsidiaries to groups or individuals holding five pct or more of the bank s capital must not exceed defined limits the value of credits given cannot exceed either one fifth of the combined capital and reserves of the bank itself or two fifths of the value of the stake owned in the bank by the group or individual concerned exceptions to these conditions include credits to concerns in which the bank itself has a stake and to branches of foreign banks credits made by foreign companies or banks to subsidiaries which have their legal base in italy will also be excluded from the conditions the bank of italy will request banks to insert rules in their statutes to ensure that companies or individuals holding five pct or more of the bank s capital are not given privileged treatment with regard to credit allocation and terms with regard to bank holdings in companies the bank of italy can exercise supervisory controls when information on a bank s consolidated activities show single shareholdings in a company or another bank of pct or more owned directly or indirectly such controls can also be exercised even if the stake held is below pct if it can be considered a controlling interest the controls will not be exercised in cases where the value of the bank s stake in a concern is below the lesser of two predefined limits these limits are set at billion lire or two pct of the total assets of the parent company of the shareholding bank reuter 
