Banks, euro, maneuver and economic situation. These are the most awaited topics among those that will touch today Ignazio Visco. Like every year, the governor of the Bank of Italy will pronounce today the final considerations, the last of his first management in Via Nazionale. It is a traditional appointment, which has always been attended by the leading personalities of finance and the Italian economy. Members of the government, on the other hand, are required not to be present, out of respect for the autonomy of the central bank.
It is not yet clear whether Visco will also hold next year's Considerations. His mandate will end on 31 October and there is still uncertainty about the possibility of renewal. Visco's relations are not the best with the former prime minister, Matteo Renzi. On the other hand, the number one in Palazzo Koch can count on the support of the Head of State, Sergio Mattarella, and the president of the European Central Bank, Mario Draghi.
Returning to today's considerations, the market awaits Visco's words on the Italian banking system with particular interest. In particular, attention will be catalysed by references to institutions awaiting the go-ahead for state aid to survive. For the Monte dei Paschi di Siena the go-ahead from the European Commission for the entrance of the Treasury into the capital should arrive shortly.
The situation is more complicated Veneto Bank and Popular Bank of Vicenza, which Brussels has forced to find a billion more private capital. In the absence of these new resources, the road to public bailout will be barred to the two Veneto banks and at least one of the two will risk bail-in. The hypothesis was actually excluded by the Minister of the Treasury, Pier Carlo Padoan, but the problem is still far from a solution and today Visco, which has repeatedly proposed a revision of the bail-in, could provide useful information to clear the fog.
The Governor is also expected to take a clear position on another issue that has sparked the political-economic debate in recent months (especially after the publication of a controversial Mediobanca-branded report), the one on “Italiexit”: the possibility, excluded by the Treaties, that our country abandons the euro to recover monetary sovereignty.
Finally, Visco should devote other passages of his considerations to maneuver launched on Monday by the Budget Committee of the Chamber (the one that Brussels imposed on us to correct the public accounts by 3,4 billion in 2017) and more generally by the economic situation crossed by the country, to its growth prospects and to the robust 30 billion maneuver that should be launched in the autumn in the next budget law.
On all this will have a decisive weight monetary policy of the ECB, which Visco contributes to determining as a member of the Frankfurt Governing Council. On this front, certainly the number one of Bank of Italy will confirm his own support for Draghi's position, who on Monday reiterated the need to continue with the extraordinary measures to support the economy and prices but will perhaps warn the country of the need to prepare for the aftermath, i.e. the end of Qe, which could be difficult for those with the burden of a very high public debt.
