Insolvency and Enforcement Reforms in Italy

Garrido, José María Failde

doi:10.5089/9781475570243.001

Cited by 10 publications

(8 citation statements)

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“…Sizeable NPL sales are planned in the coming year, which need to be implemented and backed up by strong and credible restructuring plans. Complementary measures include further advancing insolvency and enforcement reforms (beyond recent policy measures), and the facilitation of distressed debt markets (Garrido and others, 2016;Garrido, 2016;Jobst and Weber, 2016).…”

Section: B Resultsmentioning

confidence: 99%

“…3 Cognizant of these challenges, the Italian authorities have legislated a number of reforms. Measures have aimed to tackle asset quality problems, including through changes to the insolvency and enforcement framework and state guarantees on certain types of NPL securities (Garrido and others, 2016;and Garrido, 2016). To spur consolidation of Italy's fragmented banking sector-there were around 400 consolidated banking groups and about 200 subsidiaries in end-2016-the authorities passed legislation to transform the governance structure of the larger cooperative (popolare) banks 3 There were substantial write-downs in 2016.…”

Section: Introductionmentioning

confidence: 99%

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Bank Consolidation, Efficiency, and Profitability in Italy

Weber

2017

IMF Working Papers

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This paper examines the case for efficiency-driven banking sector consolidation in Italy, evaluates its potential effects on profitability, and discusses policy options to facilitate a consolidation process that is as effective as possible. A bottom-up analysis of 386 Italian banks suggests that while profitability is expected to improve as the economy gradually recovers, operational efficiency gains are nonetheless needed to restore large parts of the banking system to healthy profitability. Banking system consolidation can play a role in facilitating such efficiency gains, but its effectiveness is likely to be most as part of a comprehensive strategy that includes complementary reforms to clean up bank balance sheets. Cross-country experience indicates that efficiency gains are more likely to follow consolidations where careful viability analyses are conducted of the synergies and operational improvements that can be achieved.

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Section: B Resultsmentioning

confidence: 99%

Section: Introductionmentioning

confidence: 99%

Bank Consolidation, Efficiency, and Profitability in Italy

Weber

2017

IMF Working Papers

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“…The Italian insolvency regime is characterized by its high complexity, providing multiple procedures and debt restructuring tools that appear to lack coordination and a unified vision (see Garrido 2016). The system is divided between a generally applicable insolvency regime, and special regimes that apply to large enterprises, small enterprises and individuals, and enterprises subject to special supervisory regimes.…”

Section: B Legal Factorsmentioning

confidence: 99%

Cleaning-up Bank Balance Sheets: Economic, Legal, and Supervisory Measures for Italy

Garrido

Kopp²,

Weber³

2016

IMF Working Papers

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To stabilize and bring down nonperforming loans (NPLs) in the Italian banking system, the Italian authorities have been implementing a number of reforms, aimed among others at speeding up insolvency and enforcement proceedings, strengthening bank corporate governance, cleaning up balance sheets, and facilitating bank consolidation. This paper examines the Italian banking system's NPL problem, which ties up capital, weighing on bank profitability and authorities' economic reforms. It argues for a comprehensive approach, encompassing economic, supervisory, and legal measures. The authorities' reforms are important steps toward this end. The paper describes measures that could further support their actions.

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“…For example, the positive relationship within countries over time between the zombie capital share and non-performing loans (NPLs; see Table A15) suggests that financial sector health is related to the operation of the exit margin. Indeed, the interaction of weak financial systems with inefficient insolvency regimes and judicial systems has been especially highlighted for Italy (Garrido et al, 2016;Garrido, 2016;OECD, 2015), and may explain the particularly tight relationship between NPLs and zombie shares in that country ( Figure A4). This suggests that more in-depth analysis of the relationship between banks and zombie firms, with a focus on banking sector fragility and the role of banking supervision may be warranted.…”

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confidence: 99%

The walking dead? Zombie firms and productivity performance in OECD countries

2018

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JT03407628 Complete document available on OLIS in its original format This document and any map included herein are without prejudice to the status of or sovereignty over any territory, to the delimitation of international frontiers and boundaries and to the name of any territory, city or area. ECO/WKP(2017)4 Unclassified English-Or. English ECO/WKP(2017)4 2 OECD Working Papers should not be reported as representing the official views of the OECD or of its member countries. The opinions expressed and arguments employed are those of the author(s). Working Papers describe preliminary results or research in progress by the author(s) and are published to stimulate discussion on a broad range of issues on which the OECD works.

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Insolvency and Enforcement Reforms in Italy

Cited by 10 publications

References 5 publications

Bank Consolidation, Efficiency, and Profitability in Italy

Bank Consolidation, Efficiency, and Profitability in Italy

Cleaning-up Bank Balance Sheets: Economic, Legal, and Supervisory Measures for Italy

The walking dead? Zombie firms and productivity performance in OECD countries

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