The world’s oldest bank is in deep trouble.
Shares in Italy’s Banca Monte Dei Paschi Di Siena (BMDPF) have crashed 45% in 10 days, forcing regulators to temporarily ban short-selling in the stock. The bank has been given until Friday to come up with a plan to reduce its bad loans by 40% by 2018.
It’s not alone. Other Italian bank stocks have fallen by about 30% since June 23, when the U.K. voted to leave the European Union. Italian officials are trying to find ways to shore up the country’s financial system.
Italian banks have been choking on bad debt for years, but the U.K. vote has thrown their problems into sharp relief. Here’s how Brexit could turn Italy into Europe’s next crisis:
An economic slowdown
Economists have slashed their U.K. growth forecasts for this year and next. Uncertainty over the EU’s first divorce may also depress growth across Europe, and that’s the last thing Italy needs.
Read the Full Article: Source – CNN
Time For Truth: (CNN) – Italy: Europe’s next domino to fall?