Xinhua, Rome :
The inflow of new bad loans in Italy will remain at pre-crisis levels in the next two years, although it would stop decreasing due to an economic slowdown, the Italian Banking Association (ABI) forecast on Friday.
In its new Outlook, provided together with credit rating company Cerved, ABI said levels of non-performing loans (NPLs) to non-financial companies dropped as expected in 2019, reaching 3.1 percent.
“Such result rewards the efforts made by the banking sector in recent years, confirming its overall robustness,” ABI Director-General Giovanni Sabatini said in a statement.
For the short-term future, the report predicted a lack of domestic growth would impact negatively on the positive downward trend, “slightly increasing the performing loans deterioration rate up to 3.3 percent in 2021 against 3.1 percent in 2019.”
Nonetheless, the loans deterioration rate in this period would remain “below pre-crisis levels (3.6 percent on average between 2006 and 2008),” the report specified.
Considering data provided by the Bank of Italy, the ABI-Cerved Outlook noted the decreasing trend in the bad loans inflow “has continued at a rapid pace in 2019.”
Deterioration rates of non-financial firms showed “a significant contraction both in the first quarter and in the second quarter of 2019, distancing themselves more and more from the negative peaks reached in the economic crisis (7.5 percent by end of 2012),” it explained.
In its new Outlook, provided together with credit rating company Cerved, ABI said levels of non-performing loans (NPLs) to non-financial companies dropped as expected in 2019, reaching 3.1 percent.
“Such result rewards the efforts made by the banking sector in recent years, confirming its overall robustness,” ABI Director-General Giovanni Sabatini said in a statement.
For the short-term future, the report predicted a lack of domestic growth would impact negatively on the positive downward trend, “slightly increasing the performing loans deterioration rate up to 3.3 percent in 2021 against 3.1 percent in 2019.”
Nonetheless, the loans deterioration rate in this period would remain “below pre-crisis levels (3.6 percent on average between 2006 and 2008),” the report specified.
Considering data provided by the Bank of Italy, the ABI-Cerved Outlook noted the decreasing trend in the bad loans inflow “has continued at a rapid pace in 2019.”
Deterioration rates of non-financial firms showed “a significant contraction both in the first quarter and in the second quarter of 2019, distancing themselves more and more from the negative peaks reached in the economic crisis (7.5 percent by end of 2012),” it explained.
