Italian Prime Minister Silvio Berlusconi on Saturday defended himself following newspaper reports he had liaised with a disgraced banker at the centre of a financial scandal that has tarnished Italy's image, Reuters reported. The scandal, focused on two disputed takeover bids, has already prompted the resignation of former Bank of Italy Governor Antonio Fazio. But it has overflowed into Italian politics three months ahead of general elections since Berlusconi last week accused the opposition of having tried to influence one of the bids. Left-leaning newspaper la Repubblica reported on Saturday Berlusconi had held private meetings with Gianpiero Fiorani, the former chief executive of Popolare Italiana, the bank at the centre of the other disputed bid. Berlusconi said Fiorani, like all those involved in the takeover battles, informed him about the general progress of the bids. But he said they never gave details of their deals. "The government is neutral regarding all financial operations," Berlusconi said. "Fiorani, like all the others, came to inform the prime minister," he told a hastily called news conference. But Berlusconi said he was a neutral participant, having always said the market should decide the outcome of Fiorani's bid for Banca Antonveneta as well as insurer Unipol's offer for Roman Banca Nazionale del Lavoro. Both bids have failed, serving a blow to protectionism because they were launched to block foreign bidders Dutch ABN AMRO and Spain's Banco Bilbao Vizcaya Argentaria. Media tycoon Berlusconi called the news conference after another day of acrimonious exchanges between his centre-right coalition and the opposition about the scandals. Opposition leaders on Friday accused Berlusconi of waging a smear campaign against them after he went to see prosecutors about the Unipol bid in which he said the Left acted improperly. Berlusconi reiterated on Saturday that leaders of the Democrats of the Left (DS) took sides in Unipol's for Rome's Banca Nazionale del Lavoro. The DS has denied this and spent the past week trying to control damage from a wire tapped conversation between leader Piero Fassino and Unipol chairman Giovanni Consorte. In the conversation, Fassino asks Consorte: "So, do we own a bank?" Berlusconi has capitalised on the affair and opinion polls suggest he has narrowed the lead of the centre-left coalition, of which DS is the biggest party. He said on Saturday he would not agree to opposition's calls for a truce to end aggressive, mud-slinging campaigning. "The case is not closed," he said. "I have told all the truth and nothing but the truth ... It is the Left that has lied."
