Bad loans at Italian banks rise to new record

Bad loans at Italian banks increased to 166.4 billion euros ($227 billion) in April, up nearly 2 billion euros from a month earlier, in a sign of the still-rising toll from a two-year economic recession on bank balance sheets. It is the largest figure for loans that are least likely to be repaid since the start of the current statistical series in 1998, central bank data showed on Monday. Banks could net an estimated 76.7 billion euros from those loans were they to sell them, according to the data.
However, the pace of annual growth in soured loans slowed in April. Bad debts were up 22.3 percent from a year earlier, compared with a 23.0 percent yearly increase in March. Forced to put aside capital against possible loan losses, Italian banks cut lending to companies by 4.4 percent in April, broadly the same as the previous month, the Bank of Italy said. The central bank data is not broken down by individual lenders. Italy's biggest banks include UniCredit, Monte dei Paschi di Siena, UBI Banca, Banco Popolare and Intesa Sanpaolo.