More than a quarter of Italian SMEs are requesting a loan through a guarantee structure, but various factors (including business insolvencies and a reduction in the credit lines disbursed) highlight the serious negative trend in the national market for guarantees and the arrival of a turning point crucial for the trusts themselves. This is the picture that emerges from the research (now in its seventh edition) “The trusts in Italy”, promoted by the Torino Finanza Committee, presented today in Turin and created in collaboration with ESCP Europe and the Department of Management of the University of Turin. This is the only study available in Italy that analyzes the latest official financial statements, therefore as at 31 December 2014, of guarantee consortia.
The results of the survey reveal massive recourse to the credit instrument by small and medium-sized businesses and essentially give a snapshot of the negative credit trend: over 7% less guarantees disbursed than the previous year.
Through the analysis of the answers to the questionnaire submitted to all the credit guarantee consortia registered as intermediaries, the researchers found highly negative data, in particular those referring to the relationship with businesses (which join together to obtain a guarantee in applying for credit to banks): reduction in the stock of guarantees given, strong erosion of regulatory capital, increase in losses due to insolvencies on guarantees given, worsening of solvency, decrease in average amounts granted (-7,8%).
The protagonists of the market, as at 30 September 2015, are 396 consortia, of which 56 registered in the special list of supervised by the Bank of Italy (pursuant to article 107) and 347 instead belonging to the category of non-supervised consortia, so-called 106. In overall, most (46%) of the consortia are located in the south; 20% are instead based in the centre, while 34% of the consortia are in the north. And it is in the north that most of the supervised consortiums operate and that the greatest contraction of guarantees occurs.
The total number of trusts is decreasing (-8 compared to the previous year), also due to the new requirements requested by the Bank of Italy and by the legislator which push the protagonists of the sector towards aggregations. Among the results of Torino Finanza's research, this also emerges: the introduction of a minimum volume of financial activity, previously equal to 75 million euro, has effectively stimulated aggregation phenomena which have led to a rationalization of the system. In this sense, 2015 is the year that saw the highest number of mergers in the last 5 years, with 13 confidi involved in total.
A process which, compared to non-supervised credit guarantee consortia, sees a greater involvement of the supervised structures, many of which declare that they have planned at least one operation for the next two years. The rationalization of the activity and the pursuit of economies of scale are the main intention of these operations, especially for credit guarantee consortia pursuant to art. 107. For the unsupervised, equal importance (34%) is given to the achievement of a minimum size necessary to compete effectively with other consortia.
As for the guarantees market, it is confirmed to be highly concentrated within it: the 56 confidi 107 hold most of the existing guarantees on the market. These players are mainly in the centre-north: in the ranking of the Top 5 national confidi there are in fact Eurofidi (Piedmont), Italia ComFidi (Tuscany), Artigiancredito Toscano, Unifidi Emilia Romagna, Unionfidi Piemonte.
If the number and penetration of trusts in the productive fabric seem to show a dynamic picture of the situation, the analysis of the balance sheets of the consortia reveals that the difficulties of the companies are reflected directly on the bodies that intermediate their credit applications.
56% of the trusts saw their capital endowment decrease (in many cases by a decrease of more than 10%) and the downward trend already observed in 2013 worsens. The most probable reason for the capital decreases is to be found in covering losses for delinquencies.
The dynamics of capital decrease have had an impact on the solvency of Italian consortia, which is reduced for a third of the organizations analysed, in a situation that remains problematic (30% of consortia have decreased their TCR index with decreases even higher than 10% compared to the previous year).
Most of the loan guarantees analysed, equal to 80%, were affected by a reduction in the stock of guarantees disbursed; only 11 structures were characterized by an increase in existing stocks, but only thanks to the benefit of substantial public funds. The crisis therefore affects the state of health of the consortia, most of which (59%) have worsened their operating result compared to the previous year.
Long wave of the crisis, disintermediation of credit, obligations required by the supervision of the Bank of Italy: a scenario that makes researchers speak of a "necessary turning point" for credit guarantee consortia, in terms of organisation, management and strategy.
This situation would seem to be understood by the management of the guarantee structures which are gearing up, first of all, to deal with ex post risk management, through greater provisions, work-out operations and restructuring of problematic positions. Furthermore, in order to try to shorten the recovery times and hypothesize their role in the long term, many confidi have begun to evaluate a change of strategy.
From the analysis of the researchers, two main possible paths can be observed: the maintenance of the traditional business model, trying to expand it (confidi defined as "conservative") and the rethinking of the business model ("innovative" confidi), identifying new specifics to the within their business, such as product and/or target differentiation, radical changes in the core business and specialization on operational verticals.
