Fed Penalizes Italian Bank: The Federal Reserve...

Fed Penalizes Italian Bank: The Federal Reserve penalized an Italian bank that had made secret loans to Iraq through its office in Atlanta. Banca Nazionale del Lavoro consented to an order requiring it to increase its reserves on deposits at the Fed by $5.2 million for 18 months. The Fed pays no interest on reserves. The House Banking Committee said in October that the bank’s Atlanta office approved $2.9 billion in loans to Iraq. They had not been authorized by U.S. regulators or by the bank’s U.S. or Rome headquarters. About $1.8 billion was actually disbursed.