First the reform of the CCBs through the aggregation of cooperative credit banks into a 20 billion parent holding company with the alternative for those who do not adhere to transforming themselves into a popular bank or joint stock company and, at the same time, the recovery of banks' non-performing loans in view of the bad bank and then the eagerly awaited meeting in Berlin with Chancellor Angela Merkel. The week that begins today is a very busy week for Prime Minister Matteo Renzi.
On Thursday, the Council of Ministers should approve the reform of the Bccs with the formation of a parent holding company and the possibility for the Bccs that do not join it to transform themselves into joint stock companies or popular banks. But, in addition to the reorganization of the CCBs, the Government provision will also contain important provisions to facilitate the recovery of banks' non-performing loans in view of the European green light for the bad bank which would free Italian banks from the ballast of non-performing loans.
However, this is above all the week of truth not only for the banks but for the state of relations between Italy and Europe and in particular between Matteo Renzi and Angela Merkel. On Friday, the Prime Minister will visit the German Chancellor in Berlin with the hope of bringing home the pass for greater budget flexibility for Italy, while it will be more difficult to make progress towards the European guarantee on bank deposits.
Merkel, surprised by Renzi's recent attacks, is however greatly weakened internally after her openness to immigrants and is unable to make too many concessions. Not only that, but it will itself ask Renzi for a hand on other European policy issues starting precisely from immigration with greater border controls, as well as on the co-participation in the financing of 3 billion to Turkey. It certainly won't be an easy meeting and it will be a duel between increasingly lonely leaders.
