The level of bank non-performing loans, which reached 200 billion euros according to Bank of Italy, came close to 10% of the Italian public debt. Nonetheless, this unique mountain in the EU landscape has not yet stimulated some self-critical reflection on the part of the banking system. Paradoxical and immodest towards any sensible citizen is the self-absolute behavior of the banking system, which appeals to the crisis "around us", or which accuses the bail-in declared with even unconstitutional solemnity of the banking disaster.
Nothing is said about the incorrect assessment of the most diverse risks associated, for example, with derivatives (see the German case, which instead admits it) and with the much more widespread ones that have led to non-performing loans. Notoriously it is the market risk (see the construction sector); than that of the counterparty (for example loans given with 100% leverage); the interest rate and exchange rate, usually associated with hedging derivatives; the operational one (mathematical models for the assessment of capital absorption) and, more generally, the business model of the universal bank which links the risk of the traditional commercial bank to that of the investment bank.
A non-self-absolute reflection that estimates the weight that the incorrect assessment of each single risk category has led to the mountain of non-performing loans would help the banks themselves to adopt the necessary internal reforms and procedures connected to the assessment of each single risk component. In other words, one should honestly admit that "we too, members of the banking top management, have created the troubles, assisted by the most diverse, often dormant boards of directors and by consultants in search of compensation".
In this context, in which even the shadow banking system continues to operate (the shadow banking that is no longer talked about), to believe that the most acute failure of the financial market (banking and securities) since the post-war period can be solved by the financial market itself is an evident nonsense, which should also be recognized by the most convinced clerical supporters of the ideology that postulates the ability of financial markets to self-regulate and self-reform.
It should therefore be shared by every reasonable policy maker (also German) who, having ascertained the failure of the financial market, can only be the public hand to remedy the failure of the market itself. However, a public hand which should not be limited, if necessary, to the always implored socialization of the losses of private banks, but should take the opportunity for a reflection aimed at remedying some problems that have long been left unresolved.
For example, such reflection could lead the action of the policy maker to the separation of the commercial bank from the investment bank and to the progressive corporate concentration of the more modest banks that have irresponsibly ventured into the risky field of "doing finance".
But we must reflect on the fact that even the behavior of the ownership structures that guide the Italian banks and which have tenaciously pursued both their own debt policy (bank bonds, with information prospectuses purged of "probability scenarios"), and that of the borrowers of funds often privileged not due to creditworthiness, but due to belonging to powerful economic groups supposedly solvent or to the territory (which generate bank non-performing loans) should soon be reformed and reviewed, in order not to delay in agreeing with what the BIS observes in this regard- Bank for International Settlements (June 2016 report); or that we must "abandon the model of growth driven by debt that has acted as a political and social surrogate" (p.3). Surrogate that in the case of Italy, was abundantly distributed by the banks.
But there is more. If the banking crisis of the XNUMXs was due to the interweaving of banks and businesses, today's serious crisis is largely due to the interweaving of politics (political parties better) in conditioning the management of Italian banks. The plethoratic boards of directors of Italian banks (often the result of a mechanical application of the Cencelli banking manual), often equal to a multiple of a football team, are the result not only of the absence of a "hard core" of shareholders , but of the presence of "peanuts" (see the banking foundations) representing the deleterious ideology of the link with the territory which, in turn, is intertwined with the demands of the incumbent political and trade union class.
Imposing the sale of bank holdings on banking foundations could dissolve the link between politics and the bank. Eliminate from the consolidated finance law the special legislations - desperately defended by the individual corporations - which concern popular banks (even those transformed into joint-stock companies) and cooperative credit banks, separate the commercial bank from the investment one, impose by law the "probability scenarios" in the information prospectuses. They could be the first steps to begin to remedy the problems that have remained unresolved for too long.
