The chart below shows the amount of NPLs that are suffering, unlikely to be paid, or past due and it is clear that Italy has a very serious problem with debt.
Although state interventions are frowned upon and for the most part forbidden by the EU, there are a few options for Italy to take to backstop any financial system concerns. First, Italians can back a liquidity facility, they also can issue state guarantees on new issue securities, and finally the Italians could inject funds (bail-in) or buy up assets according to Citi’s Guelfi. None of which would assist the nation’s ailing depositor situation.
Sit back and enjoy the show, this one should be sticking around for awhile.
This article is brought to you courtesy of Tyler Durden From Zero Hedge.