Italians besiege consumer groups on banking crisis

Italians have flooded consumer groups with questions on whether to pull their savings out of banks, consumer officials say, despite assurances from leaders that Italy has little exposure to the financial crisis.

Many Italians paid scant attention to the turmoil roiling markets for much of the year until the crisis hit close to home last week when shares in Italy's number two bank, UniCredit, began a tumble due to jitters over its foreign market exposure.

Major consumer groups Adusbef, Codacons and Adoc said they had received thousands of calls, letters or visits in the past few weeks from ordinary Italians seeking advice on what to do with their savings parked in bank accounts.

"People are extremely worried," Carlo Pileri, president of consumer group Adoc said. "It's not just those who have money at UniCredit but people calling about all banks. There isn't panic yet, people are mainly calling to be reassured."

Some have taken money out of banks to park it in bonds offered by Poste Italiane, the state-owned national postal service that has catered to pensioners and families for decades, said Adusbef president Elio Lanutti.

The groups have been advising consumers not to panic and avoid withdrawing or transferring their money and reminding them that Italy guarantees bank deposits of up to €103,291.38 per depositor. But they want Italy to follow in the footsteps of peers like Germany and Ireland in guaranteeing deposits, saying Prime Minister Silvio Berlusconi's promise that Italians won't lose any money is of scant comfort without a more concrete pledge.

More than six out of 10 Italians feel their money is at risk as the US financial crisis spreads to Europe, while only 36 per cent felt the Italian banking system is very solid, a poll by Italian magazine Donna Moderna released yesterday found.