Recently presenting the book "Resolution of a crisis" (Bancaria Editrice, pages 295, Euro 35), Robert Nicastro, who was one of the curators together with Paola Leone and Secondino Natale as well as being an authoritative member of the new governance team appointed by the Resolution Unit at the Bank of Italy to manage the crisis of some banking institutions, stated verbatim that there was no "instant books".
The affirmation appears doubly justified, both because the book was published about three and a half years after that autumn of 2015 in which the 4 Banks – Cassa di Risparmio di Ferrara, Carichieti, Banca delle Marche and Banca Popolare dell'Etruria e del Lazio – which had been subjected to receiverships found themselves in a very serious capital and liquidity crisis: adding as an aggravating factor that everything was manifesting itself in the imminence of the application of the new European legislation for the resolution of banking crises.
Both, because above all the articulation of the book offers the reader a narrative path, enriched by the contribution of numerous and qualified authors (in some cases protagonists of the new governance of the 4 Banks) which is not limited to the important description of the creation of four bridge entities the so-called Good Banks and one bad bank. A bad bank, incidentally, characterized by around 10 billion bad loans and a recapitalization to cover the losses with an intervention of around 3,6 billion euro paid by the Resolution Fund.
In fact, scrolling through the pages of this book, we find that the reader is led by the hand through chapters that make him well understand and deepen the various aspects of the general issue of banking resolution and savings protection, naturally with an adequate focus on the application of the new European regulation to the 4 Good Banks. The narrative design is then completed with a second part which fully illustrates the strategic, managerial and operational aspects of the solution to the crisis of the 4 Banks, showing the different aspects for each of them in rich detail.
Finally, the concluding pages should be noted, full of effective reflections on the determinants of bank instability, on the timing and methods of Italian system approach to bank bailouts and on the many critical issues of the legislative, regulatory and environmental framework of the resolution of the 4 Banks.
In the light of what has been said so far, one can certainly agree with the statements of Andrea Sironi, professor of Economics of Financial Intermediaries at Bocconi University, who in his Preface clearly highlights the qualities of this book: the expository clarity and the coherence between the different contributions in which the work is divided; the transparency with which the positive aspects are described, but also the critical points of the long and tiring journey that led to crisis of the 4 Banks and its subsequent termination; And, Last but not least, the fact of proposing itself as an experiential paradigm of reference for future banking crises . In fact, for the former Rector of Bocconi, the lessons that can be drawn from reading the pages of this book are not negligible in terms of both the effectiveness of the work carried out by institutions, governance bodies of banks and individual individuals; both of evaluation of the factor of the times allowed for the management of the crisis; and, finally, of the crucial importance of good governance as a control and management tool.
