July 13, 2011 / 8:43 AM / 9 years ago

Italy regulator asks stakeholders not to lend shares

ROME, July 13 (Reuters) - Italy’s market regulator has recommended to stakeholders who have lent shares in Italian companies to retrieve them, Consob head said on Wednesday, confirming reports of a move aimed at curbing short-selling. “Yes, we’ve exercised moral suasion by asking all those who have lent shares to retrieve them,” Consob Chairman Giuseppe Vegas told journalists on the sideline of a conference.

He added the request was not binding.

Financial daily Il Sole 24 Ore reported on Wednesday Consob wanted banking foundations — which are key shareholders in Italian banks — to retrieve the shares lent to short-sellers.

Short-sellers typically borrow securities and sell them on, expecting to buy them back later at a lower price to repay the lender and pocket the difference.

Consob introduced on Sunday disclosure requirements on short-sales asking investors to notify short-positions on Italian stocks when they represent 0.2 percent or more of the company’s share capital [ID:nN1E76906Z].

Reporting by Alberto Sisto, writing by Valentina Za

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