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Merkel: No eurozone predicament building over Italy’s banks

“Intensive discussions are ongoing between a Italian supervision and the European Commission and we am assured that a questions that are being discussed will be resolved,” Merkel pronounced during a corner press discussion with Irish Prime Minister Enda Kenny.
   
“I do not see a difficulty building in a ubiquitous sense,” she added.
   
Fears are abundant on a financial markets that Italy could reignite the eurozone debt difficulty if it fails to tackle the €360 billion ($398 billion) in bad debt sitting in a inhabitant banks.

Markets have incited green on several Italian banks, many particularly Italy’s number-three lender and a world’s oldest bank, Banca Monte Paschi.

The bad debt difficulty poses domestic as good as mercantile difficulties for Prime Minister Matteo Renzi, who contingency conform new eurozone manners that limit a bailout of banks regulating open income unless investors shoulder bear partial of the burden.
 
 A outrageous bad debt weight is also poison for a economy as it restricts the amount of income that banks can lend to businesses, so holding behind growth.
   
The Italian economy has been ticking along with temperate if any expansion the past few years, unwell to redeem most belligerent mislaid following a global economic and eurozone crises.

Article source: http://www.thelocal.de/20160712/merkel-sees-no-eurozone-crisis-developing-over-italys-banks