...Rating Outlooks Mostly Stable: The stable outlook for Italian banks reflects better prospects for their standalone viability, supported by an improved operating environment in Italy. Fitch Ratings has revised most Italian banks' Outlooks to Stable over 2015 ¡ although in a limited number of cases Outlook revisions to Stable followed rating downgrades. The Long-Term Issuer Default Ratings (IDRs) of most Italian banks reflect their standalone profiles as reflected in their Viability Ratings (VRs). Sector Risk Also Stable: We believe the Outlook for the sector has also stabilised, after four consecutive years of being Negative. Our opinion is underpinned by evidence that net private- sector lending is no longer contracting, decelerating impaired loan formation, and of modestly improved profitability. Weak Recovery: We forecast Italy's GDP to grow by 1.1% in 2016, after it exited its deep, protracted recession this year. This forecast growth is weaker than for other eurozone members. Modest...
