The Italian government today decided that future heads of its central bank will be appointed for seven year terms instead of for life. It follows an investigation into current governor, Antonio Fazio, for allegedly favouring domestic banks in takeover bids.

The new term will apply only to future governors and not to Fazio, whose taped phone calls showed that he may have favoured Italian bank Banca Popolare Italiana over Netherlands bank ABN Amro in a bid for Italian bank Antonveneta.