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The Italian government has named Mario Draghi, an investment banker and former Treasury official, Bank of Italy governor to succeed Antonio Fazio, who quit over a takeover scandal that tainted the country's image.

Antonio Fazio has resigned as governor of the Bank of Italy, succumbing to months of intense pressure over allegations of ill practice in a bank takeover scandal that has tarnished Italy's international image.

Premier Silvio Berlusconi's government suffered a serious blow as its respected economy minister resigned amid a standoff with the Bank of Italy chief, prompting the centre-left opposition to call for early elections.
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