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This article was published on November 22, 2015 at 18:56.
The last change is the November 22, 2015 at 21:45.
Green light for the rescue of the four Italian banks “sick”. Banca Marche, Banca Popolare Etruria and Lazio, Cassa di Risparmio di Ferrara, CariChieti be made safe by an effort shared among the entire banking system, shareholders and holders of subordinated bonds. The decree approved tonight by the Council of Ministers “does not provide any form of public funding or support for banks in the resolution or the National Fund for a resolution.” The decree will come into force on the day of its publication, scheduled for tomorrow, November 23, 2015. In the evening came the formal go-ahead from the European Commission to the operation.
also avoided the risk of bail in, the new European scheme that in the case of banking crisis also involves shareholders, bondholders and depositors if necessary over 100 thousand euro, a choice that leaves so free current accounts and bonds customers: tomorrow morning, the four banks will reopen on a regular basis, to customers and employees nothing will change, but – formally – it will be four new banks (New Cariferrara, New Banca Etruria, New Banca Marche and New Carichieti), wholly owned by the Fund for a resolution.
The European Commission, having opposed to all the different solutions proposed in the last days, this morning instead endorsed the final version of the plan, which is not without a certain amount of paradox will see a pattern very similar in substance to those rejected, the same subjects conferitori but a much higher outlay .
The operation
The decree approved tonight by a Council of Ministers convened ad hoc, Italian banks “healthy” put on the plate for 3.6 billion euro rescue. A figure that – as anticipated by the Sole 24 Ore – will advance to the Resolution Fund (the tool that operationally implement the rescue) by two lines of credit fully provided by Intesa Sanpaolo, UniCredit and Ubi at market rates and maturities 18 months: the first will be refunded when the banks and bridge loans will find ways to be valued on the market. The line soon, however, will already be recapitalised by year-end thanks to the contribution of the 208 banks in the system non-Bcc to anticipate not only the 500 million contribution to the resolution fund planned for 2015, but also three annual extraordinary, for a total of 2 billion. In this case it comes to charges that will be counted as the budgets in 2015 (although the CDM has provided for a review of the tax system with the possibility of a tax deferral).
good and Banks bad bank
In detail, the plan prepared by the Government and the Bank of Italy requires that for each of the four banks the “good” part is separated from the “bad” of the budget.
to the good (“good bank” or “bank-bridge” or bridge bank) were transferred all assets other than loans, “non-performing”, that is those more doubtful; in respect of these activities are deposits, current accounts and bonds. The capital has been reconstituted to about 9 percent of total assets (risk-weighted) from “Resolution Fund”, which is administered by the Unit of Resolution of the Bank of Italy and is led by Stefano De Polis. The good bank is temporarily managed, supervised Resolution Unit of the Bank of Italy, from the directors to be designated this. President One of the four banks will be Roberto Nicastro, former CEO of Unicredit. Administrators’ clear commitment to sell the good bank quickly to the highest bidder, with transparent procedures and market, and then go back to the Resolution Fund proceeds of the sale, “as it said in a statement released by the Bank of Italy in the evening.
It will also create a “bad bank” (bad bank), without banking license despite the name, they were focused non-performing loans of the four banks that were written down to 1.5 billion from the original value 8.5 billion, and that will be sold to specialists in debt collection or directly managed to recover it better.
The cost sharing
The state, then the taxpayer is not subject to any costs in this process. The entire burden of the bailout is in place first load of the shares and subordinated notes of the four banks, but is ultimately mainly dependent on the whole of the Italian banking system, which feeds his contributions, ordinary and extraordinary Fund Resolution.
The immediate financial commitment is Resolution Fund, for a total of four banks, divided as follows: about 1.7 billion to cover the losses of banks from (recoverable perhaps in small part); about 1.8 billion to recapitalize banks good (recoverable from the sale thereof), about 140 million to equip the bad bank’s minimum capital required to operate. So, in total, about 3.6 billion.
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