ROME (Reuters) - The European Central Bank favors Italy's efforts to help its banks reduce the billions of euros of bad loans that are holding back lending and creating an obstacle to economic recovery, ECB President Mario Draghi said on Thursday.

Speaking to a parliamentary committee hearing in Rome, he said there needed to be a rapid solution to the problem of impaired loans in the euro zone overall.

"In general, the ECB looks very favorably at measures aimed at reducing the weight of impaired elements in the balance sheets of banks, including Italian banks," he said. "An initiative of this kind frees up resources for the benefit of companies above all," he said.

The comment came as Italy is pressing to create a state-backed mechanism to help Italian banks cut their heavy burden of non-performing loans, which have grown sharply since the start of the economic crisis.

Draghi also called on euro zone member states to press on with structural reforms to their economies, saying that the fact that individual governments were responsible for reforms meant that the overall monetary union remained fragile.

(Reporting by Gavin Jones and Stefano Bernabei, editing by Isla Binnie)