Mr Fazio announced he was quitting on Monday

It comes after Antonio Fazio quit the position on Monday in the wake of takeover scandal that is under investigation by state prosecutors.

Mr Fazio is accused of trying to block Italian bank Banca Antonveneta being bought by Dutch rival ABN Amro.

The bill cleared the Senate on Friday, one day after MPs approved it.

The government has also said it is close to agreeing who will replace Mr Fazio at the top job.

Continuing investigations

Mr Fazio, who continues to deny any wrongdoing, was said to have favoured a merger between Banca Antonveneta and Banca Popolare Italiana (BPI).

The story first broke in August when secret recordings allegedly showing Mr Fazio advising the former head of BPI, Gianpiero Fiorani, on how to best proceed with an approach for Antonveneta were leaked to Italian newspapers.

ABN Amro acquired a majority 69% stake in Antonveneta on 26 September, after BPI's approach was blocked by Italian authorities investigating the scandal.

Italy's central bank is currently being headed by Mr Fazio's deputy, Vincenzo Desarie.

Names being considered for the role of Bank of Italy governor are thought to include former European Central Bank executive board member Tommasso Padoa-Schioppa and former European Union competition commissioner Mario Monti.