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MILAN, Aug 9 (Reuters) – Italian banks’ credit to businesses continued to shrink in June as banks stepped up bond sales, Bank of Italy data showed on Wednesday, the latest fallout from the credit cycle. unprecedented monetary tightening by the European Central Bank.
Credit from national financial institutions to companies fell by 3.2% year-on-year, the biggest drop since September 2014, compared to the 2.8% drop registered in May.
Italian banks increased their bond issuance by 16.1% in June compared to the previous year, after a rise of 13.2% in May.
“It’s a fairly common trend, starting months ago, that usually happens when central banks raise rates,” said Luca Mezzomo, head of macroeconomic analysis at the Research Department of Intesa Sanpaolo (BIT:).
The data also showed that Italian residents’ deposits in national banks fell in June, reaching their lowest level in more than three years.
On a monthly basis, euro deposits fell by nearly 170 billion euros ($186.6 billion) to 2.44 trillion euros in June, the lowest level since February 2020.
Italian banks repaid some 143 billion euros in longer-term dedicated funds from the European Central Bank at the end of June.
On an annual basis, resident deposits at national banks decreased by 4.3% in June, following the same decline in May.
The decrease in these deposits was partially offset by an increase in those with a maturity of up to two years, which increased by around 7,000 million euros compared to the previous month, up to 82,990 million. These deposits amounted to 30,670 million in June 2022.
Central bank data also showed a slight increase in gross non-performing loans, which stood at €31.14bn in June, up from €30.23bn the previous month.($1 = €0.9111)
(Reporting by Sara Rossi; Editing by Keith Weir; Editing in Spanish by Javi West Larrañaga)
2023-08-09 12:16:30
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