Italian banks' merger breakthrough

Two of Italy's biggest banks are to merge to form Europe's 10th largest bank with a market value of €55bn ($80bn).

The merger of Banca Intesa and rival Sanpaolo IMI was agreed on 26 August with the blessing of the prime minister, Romano Prodi, stressing that Italy needed "several strong banks" that could promote its interests on foreign markets.

The merger is seen as signalling a consolidation drive in the sector, following the anti-protectionist path of Bank of Italy governor, Mario Draghi. At