With Italian voters casting their ballots in the constitutional referendum which saw Prime Minister Renzi resign, Professor Peter Hahn, Henry Grunfeld Chair of Banking, was asked by both the BBC
for his thoughts on the likely effect on the Italian banking industry.
Appearing on BBC Radio 5 Live’s “Wake up to Money” programme
, Professor Hahn spoke about economic reform in Italy and some of the challenges the banks will face, namely whether there will be a sell-off of Italian bank shares and whether they will need increased liquidity.
Professor Hahn also visited the Bloomberg studios
where he expanded upon these remarks, saying the Italian banks faced a set of unique problems, in that they had raised equity from small depositors, rather than institutions, putting individual savers at risk. A side effect of this, Peter explained, where individuals take on financial risk is political uncertainty, which has been borne out in the referendum.
Ultimately, he said, the Italians will have to make some tough decisions and it is becoming increasingly likely they government will put money into the system.
You can view the BBC interview in full here
(34 minutes in), and the Bloomberg interview here.