Resurgent Italian banks take one-third of ECB loans

Italy’s biggest banks borrowed about €30bn in the ECB’s third targeted loan operation, about a third of the total.

Banks across Europe took €97.8bn in targeted loans, or TLTROs, offered by the ECB in an effort to stimulate the economy. That compares with some €130bn borrowed in December and €82.6bn in September.

By tying cheap four-year credit to the size of banks’ loan books, the ECB is betting the funds will spur lending to companies and individuals.

Italy, the eurozone’s third- biggest economy, is starting to emerge from its longest recession on record, while the government is considering creating a bad bank to accelerate disposals of banks’ problematic assets.

“Italian banks are willing to take money from the ECB because it’s not perceived as a lack of liquidity but as a signal that they want to increase lending,” Fabrizio Bernardi an analyst at Fidentiis Equities said.

“After five years, Italian lenders are finally spurring credit on signals Italy is emerging from recession and firms want to invest for growth.”

Intesa Sanpaolo, Italy’s second-biggest bank, was the biggest borrower among lenders that disclosed their figures, taking €10bn.

That is adding to the €12.6bn borrowed in the first two auctions.

Banco Popolare borrowed some €5bn, Mediobanca got €4.5bn, and Unione di Banche Italiane SCPA took €2.9bn, spokesmen for the banks said.

Bloomberg


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