...Significant NPL Problem Lingers: The four large Italian banks rated by Fitch ¡ UniCredit S.p.A., Intesa Sanpaolo S.p.A. (IntesaSP), Unione di Banche Italiane S.p.A. (UBI) and Banca Monte dei Paschi di Siena SpA (MPS) ¡ have all started to take measures to improve their asset quality. However, non-performing loans (NPLs) remain high, accounting for 15% of gross loans at UniCredit, 14% at IntesaSP, 14% at UBI and a very high 38% at MPS at end-1H17. Impetus to Reduce NPLs: Disposals and write-downs of NPLs are accelerating at the large Italian banks. Improved economic prospects following a long recessionary period add impetus to banks' ability to tackle their NPL stocks. The accelerated pace also results from a series of measures by the ECB regulator to increase pressure on eurozone banks with above average NPLs to reduce these. So far, however, NPL ratios have only improved marginally at three of the four largest Italian banks, but not yet at MPS. Disposal Strategies Vary: UniCredit and MPS...
