Italian banks are still
struggling with weak profitability and to resolve the problem
they need to take action on several fronts including
technological investment, diversification of income sources and
cost cuts, the head of the Bank of Italy's financial oversight
department Carmelo Barbagallo said Tuesday.
Barbagallo told a forum of the union Fisac-Cgil that cost
control policies needed to continue and banks had to consider
potential reductions in their operational presence across the
country, as well as staff cuts.
"Energetic cost containment action," is required, he told
the forum.
Barbagallo also said that the total amount of
non-performing loans at Italian banks had nearly tripled since
the start of the financial crisis. However, he added that since
the start of the modest economic recovery there has been a
reduction in deteriorated credit.
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