IMF says Bank of Italy was vigilant on Monte Paschi

The International Monetary Fund said on Tuesday that it believed Italy's central bank did a good job in its oversight of crisis- hit Monte dei Paschi di Siena, Italy's third largest bank.

"The IMF team's preliminary view is that the Bank of Italy took timely and appropriate action - within the limits of the legal framework - to address problems at MPS," the IMF's chief spokesman Gerry Rice told Reuters.

"Oversight was close and supervisory action escalated appropriately as MPS's problems became acute," Rice said in a written statement.

An IMF team was in Italy until last week to conduct the first part of an assessment of Italy's financial system.

The Bank of Italy has been widely criticized over its oversight of Monte Paschi, which is set to tap 3.9 billion euros of state loans and whose former management is under investigation for fraud and other financial crimes.

(Reporting By Giselda Vagnoni, writing by Gavin Jones)