Italian banks: Time to batten down

Italian banks may struggle to maintain their resistance to capital hikes. Italy’s conservative lending culture has allowed them to argue that they are relatively sheltered from the credit crunch, and do not need to follow foreign rivals in bolstering their capital positions. But a forecast from the Bank of Italy that the economy will contract 2% this year should change all that. Italian banks are among the least well capitalised in Europe. They should seek to build a bigger cushion against what ...