ROME (Reuters) - Italy's Monte dei Paschi (MI:BMPS) and Carige (MI:CRGI), the two banks that fared worst in the ECB's recent stress tests, will soon unveil plans aimed at strengthening their capital bases, and the Bank of Italy will oversee those plans' implementation, the head of the Italian central bank said on Friday.
Ignazio Visco added that bad loans were still a problem for Italy's banking sector.
He said that small and medium-sized banks that were not part of the ECB's stress tests would have to improve their capital base, their governance, risk controls, efficiency and productivity.
"Consolidation can facilitate such progress," he said in a speech at a banking conference in Rome.
(Reporting by Alessandra Galloni and James Mackenzie)