TY - BOOK ID - 85503155 TI - Profitability and Balance Sheet Repair of Italian Banks AU - Jobst, Andreas. AU - Weber, Anke. PY - 2016 SN - 1475527632 147552756X PB - Washington, D.C. : International Monetary Fund, DB - UniCat KW - Banks and banking KW - Bank profits KW - Monetary policy KW - Financial statements KW - Balance sheets KW - Corporate financial statements KW - Earnings statements KW - Financial reports KW - Income statements KW - Operating statements KW - Profit and loss statements KW - Statements, Financial KW - Accounting KW - Bookkeeping KW - Business records KW - Corporation reports KW - Bank earnings KW - Profit KW - Asset requirements KW - Bank soundness KW - Banking KW - Banks and Banking KW - Banks KW - Countercyclical capital buffers KW - Depository Institutions KW - Distressed assets KW - Finance KW - Finance: General KW - Financial Institutions and Services: Government Policy and Regulation KW - Financial institutions KW - Financial regulation and supervision KW - Financial sector policy and analysis KW - Financial services law & regulation KW - General Financial Markets: Government Policy and Regulation KW - Industries: Financial Services KW - Loans KW - Micro Finance Institutions KW - Mortgages KW - Nonperforming loans KW - Italy UR - https://www.unicat.be/uniCat?func=search&query=sysid:85503155 AB - The profitability of Italian banks depends, among other factors, on the strength of the ongoing economic recovery, the stance of monetary policy, and the beneficial effects of current and past reforms, notably to address structural obstacles to resolving nonperforming loans (NPLs) and to foster banking sector consolidation. Improved profitability would enable banks to raise capital buffers and accelerate the cleanup of their balance sheets. This paper investigates quantitatively the current and prospective earnings capacity of Italian banks. A bottom-up analysis of the 15 largest Italian banks suggests that the system is on the whole profitable, but that there is significant heterogeneity across banks. Many banks should become more profitable as the economy recovers, but their capacity to lend depends on the size of their capital buffers. However, a number of smaller banks face profitability pressures, even under favorable assumptions. There is thus a need to push ahead decisively on cleaning up balance sheets, including through cost cutting and efficiency gains. ER -