By Giuseppe Fonte
ROME (Reuters) -The Rome government will set conditions on a possible tie-up between Banco BPM and the Italian unit of France's Credit Agricole, Economy Minister Giancarlo Giorgetti said on Wednesday.
Banco BPM is looking for a merger partner after escaping a takeover attempt by rival UniCredit, and CEO Giuseppe Castagna has listed Credit Agricole Italia and state-backed Monte dei Paschi di Siena (MPS) as the two main options.
With MPS involved in implementing the takeover of Mediobanca,
a deal with Credit Agricole Italia is seen as easier to pursue.
Asked about political objections to a BPM deal with the French lender, Giorgetti told reporters that he would apply the legislation aimed at protecting key assets -- the so-called golden powers -- to such a merger should it materialise.
"I have no political objections, I have a law that I must enforce as I have done in the recent past. As I have enforced it for others I will enforce it for them, there is a law and it applies to everyone," Giorgetti said on the sidelines of parliamentary work in the upper house, the Senate.
Castagna travelled to Rome this week to discuss merger options for the Milan-based bank with leading government officials, people close to the matter said.
Banco BPM owns 9% of MPS while Credit Agricole is the biggest investor in BPM, which is Italy's third-largest bank and plays an important role in financing small firms.
Italy is Credit Agricole's biggest foreign market, key also for its asset manager Amundi, which partners with UniCredit under a contract expiring in 2027.
With some 3 trillion euros ($3.5 trillion) each in public debt, Italy and France both have large refinancing needs and Meloni has said Italian savings should be invested domestically.
Italy had long sought to build a third large player to rival Intesa and UniCredit by encouraging a merger between BPM and MPS, which it has been successfully reprivatising after a 2017 bailout. UniCredit's swoop on BPM in November initially derailed that plan before that planned deal fell through.
($1 = 0.8516 euros)
(Reporting by Giuseppe Fonte, editing by Giulia Segreti and Keith Weir)
