Main Features of the Italian Financial System

This chapter aims to identify the characteristics of the Italian financial system that partially shielded it from the effects of the financial crisis in its first phase. This will be done by analysing the evolution of the financial aggregates and balance sheet compositions of banks at the European and Italian level. Based on the harmonised statistics produced by the European Central Bank (ECB), we compare the structural characteristics of some of the main European countries. Apart from Italy, the countries considered are Germany, France, Spain and the United Kingdom, chosen because these countries’ banking and financial systems share a number of features and trends. We also assess the average data for the financial systems of Euro Area countries. The chapter consists of three main parts. The first part identifies the current trends in the financial systems under consideration, by examining the main indicators that reveal the evolution and determinants of financial intensity. This analysis is completed by an assessment of the portfolio composition and financial structures of non-financial sectors, with a particular focus on the financial strategies of households and non-financial corporations. The next part examines the situation of the banking sectors in the various countries by establishing the size of monetary financial institutions (MFIs) and by analysing the breakdown of their balance sheets. The final part of the chapter provides a comparative analysis of the main structural and composition indicators of banking sector assets. This is followed by the main conclusions.