The Italian banking sector is in a Negative spiral. A reason for this: The interest premium (Spread) for Italian government bonds compared to German. He commutes since the inauguration of the Italian government in June to 300 basis points, and expensive the financing costs for the state, banks and enterprises. You have to pay about three times as much as German borrowers. Even a very solid Bank like Unicredit was able to sell in the past few months, a five-year bond (Senior Bond) with a massive premium loss that was six times as high as in January.
Italy's banks are sitting on government bonds in the volume of over 350 billion. Euro. The high Spread is forcing you to write-downs. According to the Banca d'italia, the banks have sustained as a result of this development in the first half of the year average value loss of nine percent. This weakens their equity capital and restrict their lending options. Higher costs will have to enter the banks in the Form of higher interest rates. The already low willingness to invest and the weak economic situation in the country suppressed.
Michael Huenseler, managing Director and banking expert at the Munich-based asset Manager Assenagon Asset Management, expects the Bank balance sheets "noticeable skid marks at the profitability" and problems especially for the banks from the second row. Deutsche Bank estimates that the high Spread of Italian banks in 2019 burdened with a billion euros. It should be added that many banks are sitting on high stocks, the failure of troubled loans. Strong on Italy-oriented banks access to the capital market is blocked.
Many of the institutes have already had to be rescued
These conditions show to follow. Foreign investors pull out funds. Also many Italians in the transfer of assets in Switzerland. In recent years, many institutions are disappeared from the market, could be more to follow. The national Deposit insurance and, with it, the most important banks in the country Carige prevented the recent bankruptcy of the Genoese Bank. You were involved with EUR 320 million in a convertible bond in the amount of 400 million.
Thus, the savings Bank met the capital requirements of European banking supervision. Also in the crisis-ridden Bank Monte dei Paschi di Siena (MPS), which was saved by 2017 through a state capital injection of € 6.9 billion before the bankruptcy, it is possible that a further government bailout is necessary. At the time of rescue action, the taxpayer lost as things Stand, more than five billion euros, because the value of the acquired state is decreased share of 68 percent in the stock market since then, solid.
for some people's banks, there are new plans, because they are massively at risk, for example, the Popolari di Bari. The approximately 280 Raiffeisen and cooperative banks (Geno) should first of all to the three larger units is summed: One for the 39 Raiffeisen banks in South Tyrol, one for the North and East of the country, and one for the centre and the South.
Only four to five major banks may survive
The Reform has, however, been a last-Minute change. The Institute will no longer be forced to play under a roof and their autonomy. Alternatively, you could enter a loose joint Liability. And Gerhard Brandstätter, President of the South Tyrol savings Bank and Vice-Chairman of the powerful banking foundations (Fund-azioni) Acri, argued, to realize for the ten savings banks in the country synergies through partnerships and collaborations.
"If the profits are eroding, costs are reduced further," says Hünseler. The institutions have recently dismantled a massive staff, and branches closed. The former Minister of economic Affairs Corrado Passera believes that, of the many hundred banks, only four to five major and about 70 regional Bank groups remain.More about
government decides on the financial plan, Italy is making € 27 billion of new debtDominik Straub
the rescue of the two Venetian institutions, the Veneto Banca and Popolari di Vicenza cost the state 20 billion euros: the bad loans were spun off into a Bad Bank and the major Bank, Intesa Sanpaolo received for the Takeover of the two institutions a "dowry" of five billion euros. Two more banks went to Ubi Banca, three of the French Crédit Agricole.