Italy Agrees 5B Euro Fund to Rescue Weaker Lenders

Italy’s strongest banks, insurers and asset managers have agreed to create a €5bn backstop fund to bail out weaker lenders in an effort to calm growing investor concern about the stability of the banking sector of the eurozone’s third-largest economy.

The rescue fund, announced by Prime Minister Matteo Renzi after a six-hour meeting of financiers, regulators and ministers in Rome, comes after a plunge in the value of Italian bank shares this year on widening concerns about the effect of €360bn of non-performing loans on Italy’s financial stability.

Dubbed “Atlas” after the mythological god who held up the sky, the fund will see UniCredit, Intesa Sanpaolo and UBI Banca, Italy’s strongest banks, handing over hundreds of millions of euros to create a backstop facility to bail out distressed smaller lenders.

CNBC

This article is for general information purposes only. It is not investment advice or a solution to buy or sell securities. Opinions are the authors; not necessarily that of OANDA Corporation or any of its affiliates, subsidiaries, officers or directors. Leveraged trading is high risk and not suitable for all. You could lose all of your deposited funds.

Craig Erlam

Craig Erlam

Senior Market Analyst - UK & EMEA at OANDA
Based in London, Craig Erlam joined OANDA in 2015 as a Market Analyst. With many years of experience as a financial market analyst and trader, he focuses on both fundamental and technical analysis while producing macroeconomic commentary. His views have been published in the Financial Times, Reuters, The Telegraph and the International Business Times, and he also appears as a regular guest commentator on the BBC, Bloomberg TV, FOX Business and BNN. Craig holds a full membership to the Society of Technical Analysts and is recognised as a Certified Financial Technician by the International Federation of Technical Analysts.
Craig Erlam