| Author (Person) | Monti, Mara |
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| Series Title | EUROPP Blog |
| Series Details | 06.12.16 |
| Publication Date | 06/12/2016 |
| Content Type | Journal | Series | Blog |
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One of the key concerns raised since Matteo Renzi’s announcement of his resignation as Italian Prime Minister following his defeat in the Italian constitutional reform referendum on the 4 December 2016 was that a period of financial instability could damage Italy’s already fragile banking system. Non-performing loans on the books of Italian banks amounted to a combined €360bn, roughly a third of the eurozone's total bad debt. Mara Monti wrote that although the short-term market reaction to Renzi’s resignation was fairly mild, there may be a more severe reaction if the political situation cannot be resolved before the end of 2016. News sources reported on the 9 December 2016 that the Supervisory Board of the European Central Bank had denied Italy’s third-largest lender Monte dei Paschi di Siena (BMPS) extra time to raise €5 billion to avoid being wound down. The Guardian wrote that 'The Italian banking system now poses the biggest risk to the financial security of the eurozone and its most venerable institution is at the heart of the problem'. The Italian parliament approved on the 21 December 2016 a government plan for a possible €20bn bailout of the country's banks. |
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| Source Link | Link to Main Source http://bit.ly/2g5h6Zf |
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| Subject Categories | Business and Industry |
| Countries / Regions | Italy |
