April 12, 2016 – SEP President Stefano Micossi testified before the Finance and Treasury Committee of the Italian Senate, during which he discussed the Italian banking and financial system. He outlines the fragile elements of Italian banks and the effect the crisis has had on their ecosystem as a whole. He asserts that a profound reform of banking regulation is needed to comply with both international guidelines of the Financial Stability Board and EU rules. New European regulations have irreversibly shifted responsibility to private holders of bank shares and bonds in the event of bank failures. For the system to work, investors need the ability to accurately evaluate banking risk, the tools for which have proven to be limited, especially now that the implicit public guarantee has been taken away. Clearer and more simple instruments are needed, and it is better to concentrate on tackling current and future challenges than reliving the past and attributing blame.
- The original testimony (in Italian) is available from Assonime.