Italy’s Financial Tangle Risks Return to Bad Old Days
Byzantine cross-shareholdings and political intrigues risk impeding much-needed consolidation.
Byzantine cross-shareholdings and political intrigues risk impeding much-needed consolidation among Italy’s banks.
Photographer: Giuseppe Aresu/Bloomberg
Italian banking is in the middle of a standoff. The weapons of choice are cross-shareholdings and takeover bids. Ask any of the antagonists what they want, and they’ll reply in the language of industrial logic and financial returns. But it’s impossible not to see the old-fashioned politics and national interest behind the scenes.
That’s a problem. Italy’s power brokers and financial factions risk dragging each other into an inescapable tangle, distracting executives and blocking its banks from developing into players that could compete across Europe and beyond. It is also short-sighted for politicians to obsess over ensuring Italian control of Italian finance at a time when US President Donald Trump’s aggressive policies make the need for European cooperation urgent.