Giuseppe Vegas, the head of Italian
stock-market regulator Consob, said Monday that the imposition
of a ceiling on the amount of State bonds held by banks risked
unleashing turbulence on the financial markets.
"It would have the effect of benefiting States with higher
ratings and force the banks to suddenly reduce their exposure to
the bonds of States with worse ratings in a disorderly way,"
Vegas said.
"A new wave of turbulence and instability on the public
bonds market would follow".
He added that this would lead to an increase in bond
yields that would have "negative effects on the sustainability"
of Italy massive public debt of over two trillion euros.
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