The new rules on banks adopted after the financial crisis have caused a temporary credit restriction that has cost Italy 1% of GDP over a two-year period. This is what we read in a forthcoming study edited by economists from the Bank of Italy and anticipated in the Annual Report of via Nazionale.
The analysis considers the increases in bank capital requirements over the last ten years. Changes that have produced greater capitalization which, recalls the Bank of Italy, entails numerous benefits for the sector, including the increase in the banks' resistance to adverse shocks.
The increase, however, may be accompanied by a restriction of credit supply conditions, as actually occurred in Italy. “Each of these interventions (increasing capital ratios, ed.) translated into a temporary reduction in the volumes of credit offered to customers and an increase, albeit limited, in the margins applied to loans”.
The consequence of the "credit restriction has had negative effects on the main macroeconomic aggregates, quantifiable in an average contraction of GDP, over a two-year horizon, of 1 per cent".
Similar results were also recorded in analyzes carried out in other countries, notes the Report in which it adds that the short-term costs deriving from the introduction of new prudential rules can be mitigated "by their introduction in the most favorable phases of the economic cycle".
