Italy: Technical Note on the Financial Situation of Italian Households and Non-Financial Corporations and Risks to the Banking System

December 6, 2013

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Italy: Technical Note on the Financial Situation of Italian Households and Non-Financial Corporations and Risks to the Banking System, (USA: International Monetary Fund, 2013) accessed November 23, 2024

Summary

This Technical Note examines the financial situation of Italian households and nonfinancial corporations and risks to the banking system. The credit risk from Italian households is mitigated by their considerable net wealth. Income has declined during the crisis, leading to tighter financial conditions for households, especially for young and low-income groups, but low indebtedness, high levels of assets, and declining interest rates have protected households from widespread debt payment difficulties. The financial situation of nonfinancial corporations, in particular small and medium-sized enterprises, is fragile, as evidenced by already high loan default rates. Continued strong policy action will be important to mitigate the impact of these vulnerabilities, especially for firms.

Subject: Banking, Credit, Financial institutions, Housing prices, Loans, Money, Mortgages, National accounts, Personal income, Prices

Keywords: CR, Credit, Credit risk, Debt burden, Debt-servicing capacity, Europe, Financial situation, Household debt, Housing market, Housing prices, ISCR, Loans, Mortgages, Operating income, Payment difficulty, Personal income, Sensitivity analysis

Publication Details

Pages:

43
Volume:

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DOI:

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Issue:

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Series:

Country Report No. 2013/348
Stock No:

1ITAEA2013007
ISBN:

9781475566994
ISSN:

1934-7685

Notes

These documents have been produced in the context of the recent Italy FSAP as background documents to the Financial System Stability Assessment (FSSA) report that was discussed by the Executive Board on September 20, 2013 and published shortly thereafter (the FSSA is available here).

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