The high price pressure and the slowdown of the global and European economy continue to represent a “high risk” for the financial stability of our country. This is what the Bank of Italy underlines according to which “the persistent geopolitical instability also weighs on the other countries of the euro area”. “Public finance conditions have improved in 2022″ – explains the report on financial stability – both net borrowing and debt have decreased in relation to GDP; the Def expects the reduction to continue in the coming years. Looking ahead, consolidating these trends remains crucial.”
Inflation is affecting the disposable income and savings of Italian households which, however, compared to other European countries, are only slightly affected by the rise in interest rates on mortgage debt. In its report on financial stability, the Bank of Italy notes a drop in real disposable income, partly mitigated by the measures implemented by the government, a drop in financial wealth of 5.6% in the second half and a -5.3 % of the propensity to save in the last quarter. Fortunately variable mortgages are only 37% of the total and 30% of new mortgages have a ceiling.
Italian banks are “in overall good condition” and will be able to generate profitability in 2023 similar to that of 2022 despite a growth in non-performing loans. In its report on financial stability, the Bank of Italy illustrates a picture, on a general level, without jolts for the sector. However, Via Nazionale does not let its guard down on the stability of funding (the disruptive cause of the Credti SUisse and Svb crises). However, Italian institutions have a large deposit base, more than half of which are under €100,000 protected by a state guarantee and less subject to outflows.
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