Bank Consolidation, Efficiency, and Profitability in Italy

IMF Working Papers, July 27, 2017

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Bank Consolidation, Efficiency, and Profitability in Italy

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Bibliographic details

• Authors: Anke Weber
• Published: July 27, 2017
• Series: IMF Working Papers
• DOI: https://doi.org/10.5089/9781484309261.001

Summary of findings

• Bottom-up analysis of 386 Italian banks suggests:
  • 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 operational efficiency gains.
• Consolidation is likely to be most effective as part of a comprehensive strategy that includes complementary reforms to clean up bank balance sheets.
• Cross-country experience indicates efficiency gains are more likely to follow consolidations where careful viability analyses are conducted of the synergies and operational improvements that can be achieved.

Policy options and considerations

• Facilitate efficiency-driven consolidation processes that are:
  • Supported by complementary balance-sheet cleanup measures.
  • Based on careful viability analyses of expected synergies and operational improvements.
• Design consolidation strategies as part of a comprehensive reform package rather than as a standalone measure.

Key statistics, subjects, and keywords

• Number of banks analyzed: 386
• Pages: 25
• Volume: 2017
• Issue: 175
• Series: Working Paper No. 2017/175
• DOI: https://doi.org/10.5089/9781484309261.001
• Stock No: WPIEA2017175
• ISBN: 9781484309261
• ISSN: 1018-5941
• Author: Miss Anke Weber
• Publication date: July 27, 2017
• Subject: Banking, Commercial banks, Cooperative banks, Credit, Financial institutions, Money, Nonperforming loans, Stocks
• Keywords: bank consolidation, bank reform, banking system, banks, Commercial banks, Cooperative banks, Credit, Global, joint stock, Nonperforming loans, popolare bank, profitability, return on equity, Stocks, WP

Source: IMF Working Paper "Bank Consolidation, Efficiency, and Profitability in Italy" by Miss Anke Weber, July 27, 2017.

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• Bank Consolidation, Efficiency, and Profitability in Italy, WP/17/175, July 2017
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