As I have noted on Twitter and in comments to journalists, Brexit has catalysed investors’ attention on weaker banking systems. As opposed to the UK banks, that are doing relatively well, given the circumstances, the focal point of the Brexit fallout is now Italian banking system, saddled with excessively high non-performing loans risks and with assets base that is, frankly, toxic, given their exposure to Italian debt and corporates.
Take a look at Kamakura Corporation’s data on default probabilities across European financial institutions:
This post was published at True Economics on Friday, July 1, 2016.
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