The recent rescue of two ailing Italian banks -Popolare di Vicenza and Veneto Banca-broke away from the standard bail-in procedures introduced by the EU. The trick used for implementing that circumvention was based on the official guarantee that the two lame ducks did not represent a systemic danger.
There were two problems in Italy’s banking system which needed to be addressed, that of Banca Popolare di Vicenza and Veneto Banca. Finally, the situation has been resolved with the start of their liquidation process and the acquisition of “healthy” assets by Intesa San Paolo.
Silvia Merler | The year 2016 has not been good to Italian banks. While resilient to the first wave of financial crisis in 2008, due to their low exposure to US sub-prime products and to the fact that Italy did not have a pre-crisis housing bubble, they have been suffering much from the euro sovereign crisis and the ensuing deteriorating economic conditions.