21 st WSBI World Congress Kuala Lumpur, Malaysia Savings banks and Foundation, as supporters of communities, municipalities and local authorities: an Italian view 21 September 2006 Fondazione di Venezia Prof. Giuliano Segre Chairman of Fondazione di Venezia, Italy

Local governments are an organisational form of any society. National States have been existing for a long time, but local communities represent a binding constraint that exist everywhere and have been also reinforcing everywhere. In a civilised Country each piece of territory has to be governed: many government duties have a local scale and the modern local governments were borne in a similar fashion. However, there exist many examples of local government forms that put down their roots in ancient times. Nowadays every country are organised in local governments. Fondazione di Venezia

Local governments by country and geographic scale in Europe

In some cases local governments result from a re- organisation of national governments Fondazione di Venezia

In other cases local governments have been the starting point for building National States Fondazione di Venezia

In the modern age Local Authorities need fiscal revenues from citizens Fondazione di Venezia

The burden of local fiscal revenues over the total amount of taxes paid by citizens specifies the form of National State Fondazione di Venezia

What does it happen whenever fiscal revenues are not enough for financing public expenditures? Fondazione di Venezia

In this case local governments may take out a bank loan Fondazione di Venezia

However to pay off a debt is not always an easy task Fondazione di Venezia

The relationship between debtors and finance system always has been difficult and is more difficult for local governments In this case a Foundation may be a good allied with local powers Fondazione di Venezia

Indeed, this is the opportunity for the Foundation’s intervention Fondazione di Venezia

1) It could be a charity support Fondazione di Venezia

2) it may be aimed at improving quality of life Fondazione di Venezia

3) It also may help local economic development Fondazione di Venezia

4) or it could enhance the social development Fondazione di Venezia

In Italy foundations have different forms: they are about 3,000. In this framework, 88 Foundations were borne in 1990 as a result of the privatization process that underwent the 88 public banks existing at that time. Fondazione di Venezia

At the beginning, each Foundation owned the 100% of the capital stock of privatized bank. Today, after 15 years Fondazione di Venezia

This kind of foundations act as normal foundations, but they use revenues generated by their assets for financing local activities as shown in the following figure Fondazione di Venezia

The following table shows as financing is distributed by sector of intervention Fondazione di Venezia

Same realizations Fondazione di Venezia Compagnia di San Paolo (Restauro Sala degli Svizzeri) Fondazione Monte dei Paschi di Siena (Azienda per Biotecnologie)

Fondazione di Venezia Ente Cassa di Risparmio di Firenze (Progetto metropolitana leggera)

Fondazione di Venezia (Teatro La Fenice)

Fondazione di Venezia (Canaletto, Il trionfo della Veduta)

Foundations are no-profit organisations that operate in order to produce goods or services either that are not produced by the market or that governments are not able to provide Fondazione di Venezia

The experience of Italian Foundation is useful for understanding future development of Savings Banks System Fondazione di Venezia