The entire episode only added to Ciampi's apprehensions about Ambrosiano; once again the authorities wondered whether to place the bank in the hands of commissioners, but decided against it. Might not De Benedetti simply have lost an ill-judged powerplay? Instead the central bank multiplied its demands for information, and its insistence that the Rizzoli shareholding be sold.
The harassed Calvi was also under simultaneous attack from Rossi. After waiting in vain on January 19 for Calvi to attend a scheduled meeting to discuss Ambrosiano's bourse quotation, the Consob chairman in his exasperation began the procedure for having Ambrosiano listed in any event. Calvi was horrified, but there was little to be done. A week later, just after the appointment of Bagnasco, he capitulated. On January 28 he travelled to Consob's headquarters in Rome to seal the surrender. Ambrosiano would be quoted as soon as possible on the main market, and the longstanding "clause of approval" for new shareholders would be abolished. In due course the first public list ever of Ambrosiano's main shareholders would also be disclosed.
Whatever judgement is made about Calvi, his life at this time must have been agony. Previous "friends" at the Vatican and the Roman political world were deserting him; at best indifferent, at worst openly manoeuvring to replace him. The pressures of the Bank of Italy, the nagging of the Consob, the pestering of Gelli, Pazienza and the like, the multiplying judicial investigations by magistrates in Milan and Rome, all had to be juggled into some kind of order. Everyone wanted money, promising protection that proved wanting, or solutions to the financial problems that were straws which snapped at the clutching. In the background loomed the appeal, the possibility it might fail, followed by the certainty of four years in a prison perhaps even less accommodating than Lodi.
The liaison with De Benedetti stands out because it was a choice made by Calvi alone, as the pressure upon him to reverse it demonstrates. Did Calvi imagine that he could use De Benedetti briefly and then discard him; that the presence of De Benedetti would somehow placate his enemies in the "lay" establishment, on the left and in the Milan magistrature which he had convinced himself was an instrument of the Communist Party? Or was it one genuine moment of sincerity, when Calvi in his contorted way sought to convey that he wanted to have done with everything, and save the bank he had created from a disaster he knew could not be far away? We shall never know. But if such a moment existed, it was short-lived. For Calvi, as that November day in Drezzo showed, was no longer in command. The pattern was not to change with the arrival of Bagnasco.
CHAPTER EIGHTEEN Last Illusions
Carlo De Benedetti's departure, though rued by some within Ambrosiano, marked the speedy return of the bank to its appointed place within Italy's political firmament. Orazio Bagnasco was on excellent terms with Giulio Andreotti—the Christian Democrat most expert in the ways of the Church, and the politician whom Calvi held most in awe, even fear. Also, Bagnasco himself was well regarded by the Vatican ("Yes, I know some cardinals and bishops," he once coyly told an interviewer). There was small doubt that he was the chosen successor to the ever more compromised Calvi when he entered Banco Ambrosiano that January 26; Calvi was aware of all this, of course, but he was too weak to put up much opposition.
The ground for the agreement had been carefully prepared. Ever since mid-December, when the improbable partnership with De Benedetti was beginning to fray, Bagnasco had been buying Ambrosiano shares. Terms were settled at one of those weekends at Drezzo, where occasionally Ciarrapico, the publisher whom Calvi now knew, would also be in attendance. Calvi confided to his family that he was unhappy about Bagnasco; and as he left the house on the morning of January 26, he told his daughter that he hoped Ambrosiano's board would not approve the appointment.
In the event, the other directors unanimously endorsed Bagnasco as De Benedetti's replacement. The first stirrings of collective unease by the long submissive board—or merely another example of how Calvi would dispense different truths to different people, including his family? In any case, as he complained back at home that evening, Ambrosiano had become a sort of tramcar, which people got on and off as they pleased. Bagnasco was to ride the tram until the bitter end. Voices, however, were being raised in contrasting places, but with identical urgency, that its driver be changed at once.
A public complaint by De Benedetti on how Calvi had prevented him from carrying out his statutory duties as a director prompted Gustavo Minervini and Luigi Spaventa, two respected deputies from the independent Left, to table a question in Parliament, asking the Bank of Italy to dissolve Ambrosiano's board and send in special commissioners. Given that both had been elected under Communist sponsorship, that might have been construed as politicking. But on March 19 they were to table another question, after a second public tirade by De Benedetti, this time concerning Banco Andino and those inexplicably large loans it had extended.
Did the Bank of Italy have the necessary details about Andino, the two deputies asked? God forbid, they added, that another Sindona affair was in the offing. With timing either sinister or ludicrous, a bland written answer, implying that nothing was critically amiss, arrived from the Treasury Ministry three months later, just as Calvi was packing his bags for flight.
But different worries were surfacing in an almost opposite quarter. A group of small Milanese shareholders in Ambrosiano, all devout Catholics, wrote to the Pope himself protesting at how the bank, for all its vaunted links with Church and IOR, had strayed from the ideals of its founders'. Calvi, they stated, "was the point where Sindona's Mafia legacy and degenerate freemasonry met". The IOR either could remain Calvi's "accomplice", and lay itself open to a new scandal that would last a decade; or it could work with other shareholders for change, by selecting a prestigious outsider to take over as chairman. Rosone, of course, had already had a similar idea, with the unsuccessful effort to bring back Mozzana. Whether the Pope, or anyone else in a position to act within the Vatican, ever read the letter is not known. In any case, it would have been too little, too late; for the Bank of Italy was now closing inexorably upon the truth.
For a man as jealously uncommunicative as Calvi, convinced that every shred of truth revealed was a weapon to be turned against him, the months between February and April of 1982 must have been the purest torture.
One by one, Ambrosiano's secrets were prised from its recesses by inquisition of the central bank. Calvi hoped he had bought at least time, by consenting against his every judgement to a full stock market quotation for Banco Ambrosiano. This would automatically have entailed fully consolidated accounts, including the foreign subsidiaries, from 1983. Surely that would satisfy the authorities. But no. Hardly a week went by without the central bank demanding more information. Calvi knew that in months, at best, the terrible flaw in Latin America would be surmised, if not conclusively proved— unless, of course, the debts could be repaid, or transferred on to stronger shoulders than those of the IOR.
Various reasons underlay this offensive by the Bank of Italy. One was the disturbing exit of Carlo De Benedetti, who had written to Ciampi insisting that something had to be done about Ambrosiano. The second was the announcement at the end of January that Ambrosiano Overseas planned to merge with Artoc, and create a single Bahamas bank with deposits of $1,000 million.
De Benedetti's going was one more pointer to advancing putrefaction, while the proposed arrangement with Artoc looked suspiciously like another attempt to avoid the Bank's scrutiny, by expediting an important foreign affiliate into a convenient Arab refuge. On February 5, Calvi was summoned to the central bank in Rome to provide details of his foreign dealings in general, and of the Artoc scheme in particular. His elusive and non-committal answers exhausted Ciampi's patience. Eleven days later he received a bluntly worded letter from the Bank of Italy's Milan office. It demanded comprehensive information on every aspect of Ambrosian's foreign activities; it insisted, moreover, that the matter be submitted to a board meeting, at which every director should confirm that he was
being told enough to do his job properly. A copy of the minutes was then to be sent to the Bank of Italy.
The board duly met. One Ambrosiano director, Giuseppe Prisco, head of Milan's bar association, was so angry that he formally tabled comment on the central bank's request as "inopportune, and offensive for individual directors". His colleagues unanimously agreed— but they had no choice but to comply. Finally, the Bank of Italy was showing its real teeth.
Nor had Ciampi's humour been improved by the treatment meted out to two inspectors he had sent informally to Lima, to try and glean some facts about the mysterious Andino. The pair were treated with disdain by the Peruvian authorities, and subjected to a menacing search by frontier police at the airport as they returned to Italy. In the event, though, the setback hardly mattered.
One by one, the veils were being removed in Milan. With as good grace as could be mustered, the direzione centrale of Ambrosiano provided first a breakdown of the balance sheet of the Luxembourg holding company, then those of the subsidiaries in Nassau, Nicaragua and Peru. Every number was a tiny stone, with which to reconstruct the financial mosaic Calvi had created across half the world. The Bank of Italy's appetite was insatiable. Once an answer from Ambrosiano even crossed in the post with a new set of demands.
At last, on March 31, the requests halted, but not before the central bank had vetoed the proposed merger with Artoc in Nassau. The last thing it wanted was for Calvi to be able to use the humours of the Arabs, on whose oil Italy heavily relied, as a bargaining counter in his dealings with the authorities in Italy.
Then Calvi dangled before his tormentors a scheme to reorganize his Italian holdings, to overcome the long-standing objection that Ambrosiano's structure was in breach of local banking laws. Instead of it owning the financial company La Centrale, the roles would be reversed. But, he pleaded, the scheme was complex and required time. Time, unfortunately, the Central Bank was no longer prepared to grant.
In the midst of these exchanges with the Bank of Italy, a new passenger climbed aboard the tramcar—though if truth be told, he had been dragged along in its wake for several years. He was Carlo Pesenti, whose own indebted Italmobiliare group was supported in part by large borrowings from Ambrosiano and its various Italian banks, secured by large blocks of shares in companies controlled by Pesenti. At first his arrival seemed to presage the formation of a single Catholic-orientated financial leviathan, adding the banks and insurance companies owned by Pesenti to Ambrosiano's own.
In fact, two enfeebled creatures were clinging together in their hour of trial. Like Calvi, Pesenti was under investigation for certain of his past dealings. Most notable of them was a curious 50 billion lire loan granted to Pesenti in 1972—apparently by the IOR—and indexed to the Swiss franc. The latter's appreciation meant that the sum eventually reimbursed was 185 billion lire. A decade after that loan was signed, magistrates in Milan were still unsure whether the Vatican bank had excogitated a brilliant deal, or whether it had acted as a "fiduciary" once more, this time for an irregular capital export by Pesenti.
On March 10, Ambrosiano announced that Pesenti had joined its board, and that Italmobiliare had become the bank's largest shareholder, with 3.62 percent of its capital. His advent served a variety of purposes. The million shares sold by De Benedetti would be absorbed neatly, without risk to the market price of Banco Ambrosiano, while a brush of respectability would be given to the list of main shareholders which would have to be contained in the obligatory public prospectus accompanying its listing on the main market. If the Cascadillas and Orfeos in Panama would be displayed in their dubious splendour for the first time, at least the biggest shareholder of Ambrosiano could be demonstrated to be Italian. What was not announced was that Calvi's bank had underwritten a loan for 100 billion lire, with which Pesenti could buy its shares.
The average price he paid, of just under 55,000 lire per share, put a theoretical market valuation on Ambrosiano of almost 2,750 billion lire, or $2,100 million. On paper, Calvi's shaky edifice was now worth more than Chase Manhattan bank—reassurance of a kind before what promised to be a less than usually deferential annual meeting, due on April 17,1982. For friendly stockbrokers had reported to him that small Catholic shareholders, alarmed by the unceasing bad publicity Calvi was attracting, were selling out. This most unwelcome development was being absorbed and concealed, thanks to the arrival of Pesenti and huge, quite illegal, buying of Ambrosiano shares by the bank's own securities department. But Calvi was nervous of the shareholders' meeting, although he did manage to win postponement of a potentially embarrassing magistrates hearing scheduled for two days before, thus reducing the danger of still more harmful press comment.
In the event, his fears were only partly borne out. A record total of 472 shareholders attended. The little Panamanian and Liechtenstein companies as usual had given their proxies to the chairman, so that he could boast that 43 per cent of the bank's capital was represented. Many doubts were removed by the 1981 results. They were almost the last of Calvi's feats of illusion. Profits had tripled to 43 billion lire, while Banco Ambrosiano's net assets had more than doubled— thanks to the substantial capital increase of the year before (carried out while the chairman was in prison!). Total assets, meanwhile, of the group, including Credito Varesino and Banca Cattolica del Veneto, reached almost $20 billion. The dividend, the last the bank would ever pay its trusting shareholders, rose by 60 lire to 420 lire. And if he was accused of running Ambrosiano too autocratically, then that too, Calvi could claim, was changing. An executive committee was being established, so that important decisions would be taken on a more collegial basis. The intended message was plain: that Ambrosiano's 38,000 shareholders need have no worries. One did, however, and most unusually he said so.
Already some eyebrows had been raised by the apparent boycott of the meeting by two Catholic shareholders, the Fabbrica del Duomo, responsible for the upkeep of Milan Cathedral, and Banca San Paolo di Brescia, founded by the same Monsignor Tovini who had established Ambrosiano in 1896. Why, asked one Giuseppe Nicora, were Christian tenets of Tovini being ignored by the present management? Nicora, who held 1,300 shares which had a market value of 65 million lire and probably represented the bulk of his savings, described himself as a typical small shareholder from Lombardy. But he was worried at how Ambrosiano had become a "machine for speculation". And, he warned, there were many others like him, who would show their disapproval at what was happening, "irretrievably different" from what Tovini had intended.
The assembly passed off without further ado. As usual Calvi paid no reference in his closing speech to Nicora's anxious questioning, other than to observe that Ambrosiano had to move with the times. "The facts are in the balance sheet, all the rest is gossip," another, more typical shareholder, proclaimed, and the 1981 accounts were overwhelmingly approved.
But the protest had been noted elsewhere. A few days afterwards Marcinkus gave a rare interview to the Italian press, to declare that beyond doubt, Calvi was "worthy of the IOR's confidence", and that contrary to rumour, the Vatican bank had no intention of reducing its shareholding—then still assumed to be the 1.6 per cent which would appear in the market prospectus on May 1. Marcinkus, in the first of the famous last words which would pepper the last weeks of Ambro- siano's life, said the IOR placed its money where they gave the best return, and that Ambrosiano had been "an excellent investment".
On balance, though, all had gone reasonably well. One newspaper described Calvi's performance at the meeting as "unusually pugnacious". The annual report also contained slightly more information than usual—including the somewhat perplexing revelation that during 1981 Ambrosiano had extended two large credits, for $71 million and $60 million respectively, to its Nicaraguan and Peruvian subsidiaries. He did not elaborate: nor could he. For those two loans were the first and only admission of the process which in less than two months would bring ruin. But announcement of the choice of Coopers and Lybrand to draw up consolid
ated accounts from 1983 on set the minds of the unsuspecting at rest.
An outward façade of normality still for the most part prevailed, even if Calvi seemed weary, and naturally concerned about his problems with the judiciary, and the appeal now set for late June. But sometimes the mask would slip. On May 15, he ran into Nerio Nesi, chairman of Banca Nazionale del Lavoro, at Ciampino airport, as he made his way back to Milan after yet another sortie to Rome to shore up his collapsing defences. Nesi was off to Egypt, to open BNL's new office in Cairo. "Everyone's exploiting me, it's too much to bear," Calvi told Nesi. He seemed crushed, half-destroyed.
Another such moment had come a few days earlier in Milan, as trading opened on the full market in Banco Ambrosiano shares. Calvi, obviously, had to attend. He wandered morosely down to the corbeille, or main ring on the trading floor, where the dealers shouted and gesticulated their transactions. His face pale and expressionless, he watched the price slide downwards: from 50,000 to 45,500 lire at the first call, then to 40,000 lire at the close. Despite friendly support buying arranged in advance, the value of the main asset underpinning the Panamanian folly had fallen twenty per cent in a single day.
Later on there was the routine cocktail party to mark a supposedly happy occasion. Calvi greeted Isidoro Albertini, one of Milan's leading stock brokers, who had known him vaguely since the Bocconi days. Sipping at a fruit juice, Calvi avoided conversation about Ambrosiano, limiting himself to reminiscences about the Russian campaign. He was fatalistic and dejected—for reasons only too obvious.
The importunings of the central bank and the attentions of the magistrates (concerning Sindona, the P-2, and the Genghini affair, to name but three of the most serious) were only two of the vicious interlocking pressures upon him. None had ever shared his power, and now none, beyond his family, could share his ordeal.
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