SNL Financial warns of hole in Italian bank books

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SNL Financial, the US headquartered provider of business data, has published figures suggesting that Italy’s banking sector faces a significant shortfall in its capitalisation of between €25bn to €70bn for those banks being reviewed by the ECB as part of the region’s ongoing stress testing activities.

Based on data from the ECB, SNL said that the sector lost money in 2011, 2012, and 2013, leaving both assets and profitability in a poor state.

This could result in a significant call for new capital to be injected to ensure the sector meets the Core Tier 1 capitalisation requirements, as being stress tested currently by the ECB, EBA and national banking regulators as part of the overall Asset Quality Review (AQR) of Europe’s biggest lenders.

SNL data suggests that the ratio of reserves/non performing loans across a swathe of Italy’s biggest banks averaged around 46%.

“NPL ratios at the end of June 2014 for all banks subject to the AQR were double-digit figures, ranging between 13.9% for Banca Popolare di Sondrio SCpA and 28.9% for Banca Monte dei Paschi,” SNL stated.






Jonathan Boyd
Editorial Director of Open Door Media Publishing Ltd, and Editor of InvestmentEurope. Jonathan has over two decades of media experience in Japan, Australia, Canada and the UK. Over the past 17 years he has been based in London writing about funds and investments. From editing the newsletter of the Swedish Chamber of Commerce in Japan in the 1990s he now focuses on Nordic markets for InvestmentEurope. Jonathan was awarded Editor of the Year at the Professional Publishers Association (PPA) Independent Publisher Awards 2017. Shortlisted for the same in 2016, he was also shortlisted in 2017 and 2015 for the broader PPA Awards category Editor of the Year (Business Media).

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