MILAN (Reuters) -Italy's financial markets watchdog Consob said on Friday a lack of regulatory alignment with the European Central Bank is creating friction in the oversight of a recent wave of Italian banking deals.

The country's banking sector has in the last year seen a raft of bids and offers, including UniCredit's all-share offer for smaller peer Banco BPM, creating a complex web of deals between some of its biggest players.

In a speech delivered for Consob's annual assembly in Milan, the watchdog's President Paolo Savona mentioned "difficulties" in coordinating with the ECB during the evaluation of six takeover and share-exchange offers that have emerged since late 2024.

"Despite the fact that Consob had signed a memorandum of understanding (with the ECB) committing to exchange information without the need for specific formal reminders, difficulties in dialogue arose, raising uncertainties about the timing of responses," Savona said.

Many of the banking deals rely heavily on equity swaps—mechanisms sensitive to market fluctuations and closely watched by international investors.

"These price-dependent structures require timely, coordinated oversight," Savona said.

The ECB declined to comment on the matter.

The wave of bids rocking Italy has pitted the country's second-biggest bank UniCredit against the government over its proposed public exchange offer for Banco BPM.

Italy has invoked its "golden powers" to set the terms of UniCredit's offer, citing national security concerns.

Savona said the Italian rules - initially introduced as an extraordinary safeguard against hostile takeovers - have become a catch-all tool, with increasing government intervention requests to manage perceived threats from foreign investments.

He said aligning these domestic frameworks with European treaty obligations is urgent, especially amid EU-level discussions on reforming foreign direct investments.

(Reporting by Giancarlo Navach, additional reporting by Valentina Za, Writing by Giselda Vagnoni, Editing by Jan Harvey)