(supersedes previous)European Central
Bank (ECB) oversight board member Ignazio Angeloni told the
Senate Tuesday Italy's new Atlante fund to shore up weak banks
and the government's new public guarantees on non-performing
loans (GACS, in its Italian acronym) are a step in the right
direction but "can't cause a turning point on their own".
"With its current reduced size, the Atlante fund will only
be able to intervene on a limited number of small and medium
banks," he said.
Angeloni added Atlante's first operation - its takeover of
struggling Banca Popolare di Vicenza - will be "an important
test case" and said it was "to be hoped" that more capital would
flow into the fund.
Atlante is a new private fund to aid struggling Italian
banks avert the risk of bail-ins and keep the national banking
system stable. It does so by underwriting capital increases and
helping banks get toxic loans off their books.
Angeloni went on to praise the current government's reform
of Italy's small 'popolari' banks and cooperative credit unions
They are "a very positive tool with which to rectify
governance shortcomings," he said.
"The reform should increase shareholder control in both
segments, increase banks' access to capital, reduce the risk of
a concentration of power in the hands of minority stakeholder
groups, and offer opportunities for cost synergies," Angeloni
said.
"The consolidation of these two sectors would increase
banks' efficiency and competitiveness, putting them in a better
position to support the entire (national) economy. We support
Italian authorities in their reform effort," he said.
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