ECB's Draghi phoned Napolitano over resignation reports: press

European Central Bank President Mario Draghi phoned Italian President Giorgio Napolitano after media reports that the 87-year-old head of state was planning to resign early to clear the way for new elections, newspapers reported on Sunday.

Napolitano pledged on Saturday that he would stay in office until the end of his term on May 15 following reports that he planned to step down to break the deadlock created by last month's election, which left no party able to form a government.

The move would be needed to allow Italy to return to the polls before the summer holiday period, because of constitutional provisions which prevent a president from dissolving parliament in the final months of his mandate.

The main newspapers on Sunday all reported that Draghi had called Napolitano to express concern that his resignation would leave Italy without leadership at a time of mounting tension in financial markets, exacerbated by the bank crisis in Cyprus.

An ECB spokesman declined to comment. No comment was immediately available from Napolitano's office.

Helped by the ECB's pledge to backstop countries by buying their bonds if necessary, financial markets have not shown the levels of panic seen during the crisis which brought down Silvio Berlusconi's last government in 2011.

However a poorly received auction of mid and long-term debt last week underlined the danger of a renewed bout of turmoil that could destabilize Italy's 2-trillion-euro public debt if the impasse continues.

Rumors have been circulating for days that Moody's is preparing to cut its rating on Italy's sovereign debt, which is already only two notches above "junk" grade, partly due to the uncertain political outlook.

(Reporting by James Mackenzie and Paul Carrel in Frankfurt; editing by Andrew Roche)