Italy Granted “Extraordinary ” €150BN Bank Bailout Program To Prevent “Panic, Run On Deposits”
How did this happen so quietly under the table and without Merkel’s blessing? WSJ says that the program was approved under the bloc’s “extraordinary crisis rules for state aid.”
And here we thought that Italy’s banks are actually doing so very well. Oh wait, no we didn’t.
As the WSJ notes, the proposed “crisis” plan is the “other leg of an intervention plan considered by the government” namely, the direct capital injection into Italian banks that would add up to €40 billion in capital to the banking sector”, the one we profiled previously. It is also the plan that Merkel supposedly shut down before it got off the ground. However, Europe had a Plan B up its sleeve.
What are the details of this latest “crisis” program?
According to an EU official, the liquidity support program includes up to €150 billion ($166 billion) in government guarantees. The WSJ adds that the commission spokeswoman declined to comment on the amount of guarantees that were authorized, but said that the budget requested by the Italian government had been found to be proportionate. The Italian economy ministry declined to comment.
…click on the above link to read the rest of the article…
