The evolution of the banking system in Italy according to the FABI: less credit, more commissions
FABI, the largest syndicate of Italian bankers, conducted a research on the financial statements of Italian banks, to identify their evolution. The results are interesting because they highlight what is happening to our banks, their evolution and the dangers that these changes pose.
The most obvious change is where bank profits originate. The theory would have it that most of the profits in the sector originate from the so-called Financial Intermediation: the bank takes the funds from savers and re-uses them in loans, earning from the difference between interest paid and received. According to those surveyed by the FABI, this model is in the process of being overcome. Currently 50.5% of turnover comes from intermediation, while 39.4% is generated by services and commissions. Not only that: the assets engaged in customer loans rose to 52 billion in 2020 from 40.7 in 2019. This is due to the 190 billion loans guaranteed by the state which, however, as we can see, have turned into actual loans only minimally and remained largely unused.
So the banks have become "financial shops" that earn from services. If it is true that lending rates are low, passive rates are either zero, for retail funding or negative, if you contact the ECB. therefore there would still be a lot of room to expand brokerage activity, but this does not seem to interest banks. However, this is a very dangerous evolution because the continuous innovations of the fintech sector can make to disappear, as in the past, sources of income that appeared to be solid and long-term. In addition, banks often resell third-party products, putting themselves in stiff competition with each other. The sector therefore becomes risky and dangerously mature.
Thanks to our Telegram channel you can stay updated on the publication of new articles of Economic Scenarios.
The article The evolution of the banking system in Italy according to the FABI: less credit, more commissions comes from ScenariEconomici.it .
This is a machine translation of a post published on Scenari Economici at the URL https://scenarieconomici.it/levoluzione-del-sistema-bancario-in-italia-secondo-la-fabi-meno-credito-piu-commissioni/ on Sat, 21 Aug 2021 17:11:52 +0000.