Skip to content
Subscriber Only

Italy Bank Bulls Say Bad Loan Panic Overdone as Stocks Slide

  • ECB rule ‘net positive’ for financial stability: Goldman Sachs
  • Investor says October slump in Italian banks an over-reaction
Updated on

Italian banks are being backed by some investors to withstand tougher European Central Bank rules on bad-loan provisioning that sent their shares tumbling.

A 6.9 percent drop in a gauge of the nation’s lenders in the six days through Tuesday was blown out of proportion, according to Ronald Petitjean, a Paris-based fund manager at LA Francaise Inflection Point. With the International Monetary Fund increasing its growth forecasts for Italy on Tuesday, a resilient economy will disprove any concerns about the health of the country’s banks, he says. The index rebounded 2.3 percent on Wednesday.