{"id":18585,"date":"2016-03-07T13:52:15","date_gmt":"2016-03-07T18:52:15","guid":{"rendered":"http:\/\/olduvai.ca\/?p=18585"},"modified":"2016-03-07T13:52:15","modified_gmt":"2016-03-07T18:52:15","slug":"will-italian-banks-spark-another-financial-crisis","status":"publish","type":"post","link":"https:\/\/olduvai.ca\/?p=18585","title":{"rendered":"Will Italian banks spark another financial crisis?"},"content":{"rendered":"
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Will Italian banks spark another financial crisis?<\/a><\/h3>\n

\"Will<\/span><\/p>\n

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In the 14th\u00a0century, the Medici family of Florence began its rise to prominence, investing profits from a thriving textile trade to fund what would become the largest banking institution in Europe.\u00a0 The success of the legendary banking family helped to usher in the Italian Renaissance and thus change the world. Now, Italian banks seem poised to alter the world yet again.<\/em><\/p>\n

Shares of Italy\u2019s largest financial institutions have plummeted in the opening months of 2016 as piles of bad debt on their balance sheets become too high to ignore.\u00a0 Amid all of the\u00a0risks<\/a>\u00a0facing EU members in 2016, the risk of contagion from Italy\u2019s troubled banks poses the greatest threat to the world\u2019s already burdened financial system.<\/p>\n

At the core of the issue is the concerning level of Non-Performing Loans (NPL\u2019s) on banks\u2019 books, with estimates ranging from 17% to 21% of total lending.\u00a0 This amounts to approximately \u20ac200 billion of NPL\u2019s, or 12% of Italy\u2019s GDP.\u00a0 Moreover, in some cases, bad loans make up an alarming 30% of individual banks\u2019 balance sheets.<\/p>\n

\"download\"<\/a><\/p>\n

The red flags initially attracted the attention of the European Central Bank (ECB), prompting an official inquiry that investors viewed as a flashing \u2018sell signal.\u2019\u00a0 Shares of Italian banking companies lost more than 25% in the first several weeks of the year.<\/p>\n

Though markets have pared losses in the last few weeks, March has brought renewed concern for the health of Italy\u2019s financial sector.\u00a0 Adding more worries to fuel the fire, on\u00a0Friday<\/a>\u00a0the ECB demanded that one such troubled Italian bank, Banca Carige SpA, provide new strategic plans and additional funding in order to bolster its balance sheet and meet supervisory requirements by the end of the month.\u00a0 The news sent bank shares on yet another swoon, prompting trading halts on several as the volatility triggered maximum loss \u2018circuit breakers.\u2019<\/p>\n

…click on the above link to read the rest of the article…<\/p>\n","protected":false},"excerpt":{"rendered":"

Will Italian banks spark another financial crisis? In the 14th\u00a0century, the Medici family of Florence began its rise to prominence, investing profits from a thriving textile trade to fund what would become the largest banking institution in Europe.\u00a0 The success of the legendary banking family helped to usher in the Italian Renaissance and thus change […]<\/p>\n","protected":false},"author":1,"featured_media":0,"comment_status":"closed","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"_monsterinsights_skip_tracking":false,"_monsterinsights_sitenote_active":false,"_monsterinsights_sitenote_note":"","_monsterinsights_sitenote_category":0,"footnotes":""},"categories":[2],"tags":[63,233,281,282,312,353,1464,12806,6559],"class_list":["post-18585","post","type-post","status-publish","format-standard","hentry","category-economics","tag-banks","tag-ecb","tag-europe","tag-european-central-bank","tag-financial-crisis","tag-gdp","tag-italy","tag-jeffrey-moore","tag-non-performing-loans"],"_links":{"self":[{"href":"https:\/\/olduvai.ca\/index.php?rest_route=\/wp\/v2\/posts\/18585","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/olduvai.ca\/index.php?rest_route=\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/olduvai.ca\/index.php?rest_route=\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/olduvai.ca\/index.php?rest_route=\/wp\/v2\/users\/1"}],"replies":[{"embeddable":true,"href":"https:\/\/olduvai.ca\/index.php?rest_route=%2Fwp%2Fv2%2Fcomments&post=18585"}],"version-history":[{"count":1,"href":"https:\/\/olduvai.ca\/index.php?rest_route=\/wp\/v2\/posts\/18585\/revisions"}],"predecessor-version":[{"id":18586,"href":"https:\/\/olduvai.ca\/index.php?rest_route=\/wp\/v2\/posts\/18585\/revisions\/18586"}],"wp:attachment":[{"href":"https:\/\/olduvai.ca\/index.php?rest_route=%2Fwp%2Fv2%2Fmedia&parent=18585"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/olduvai.ca\/index.php?rest_route=%2Fwp%2Fv2%2Fcategories&post=18585"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/olduvai.ca\/index.php?rest_route=%2Fwp%2Fv2%2Ftags&post=18585"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}