Anna Maria Tarantola: Cooperative banks and competition - local
vocation and governance issues
Address by Ms Anna Maria Tarantola, Deputy Director General of the Bank of Italy, at the
Istituto Centrale delle Banche Popolari - Associazione Nazionale delle Banche Popolari
"Cooperative Banks: Italian and European Aspects", Taormina, 27 February 2009.
* * *
Introduction
I would like to thank the organizers for inviting the Bank of Italy to take part in today's
meeting in honour of Professor Giuseppe Muré, a man of great distinction, who combined an
academic career with his role as representative of the banking profession, offering a
constructive contribution to the complex issues surrounding the business of banking.
The role of local banks was a theme that Professor Muré examined on many occasions in
the course of work on a broad range of topics, and he was always passionately convinced of
their valuable role in supporting SMEs. At a meeting on "Dimensions and Processes of
Growth" some twenty years ago, he stressed "the competitive advantage of a bank with a
local dimension, which as we all know can adhere to the economic fabric of its place of
-
business" and emphasized that this fundamental resource should not be wasted indeed,
that local banks should preserve their local identity.1
The value of the business model adopted by Italy's cooperative "popular banks" (banche
popolari) is a very topical issue. It is at the centre of a lively debate concerning the
transformations that the category of cooperative banks has undergone, as well as the
economic and productive slowdown, both of which draw attention to the relationship between
bank and local area.
I will begin my talk by looking at how the banche popolari have evolved in the Italian system
and how this fits into the European context of cooperative lending before examining their role
in supporting the economy and analyzing their main technical characteristics. Finally, I will
look at their particular system of governance and consider prospective regulatory
developments.
In general, the banche popolari have responded to increasing competitive pressure by
reviewing and revising their strategies. Large-scale banks have been created, with diversified
production, complex group structures, and establishments abroad as well as at home. Small
banks of limited operational complexity continue to exist alongside them.
While more and more marked differences have emerged within the category, regulations
have remained largely the same. We must consider whether this framework is still
appropriate to the changed needs of banks, investors and clients and to the aims of the
supervisory authority.
1. The role of banche popolari in the development of Italy's banking system
Italy's banking system has undergone profound changes in the last decade: in size, in
manner of operation and in organizational structure. Rapid progress in information and
communication technology, financial innovation, growing international openness, and
changes in demand for banking and financial services have all led to stronger competition
and prompted a far-reaching process of concentration among banking institutions and a
rationalization of their productive structures.
Mergers have led to an increase in the average size of banks, more complex and structured
forms of group organization, and a diversification of customer relation policies and methods.
The number of banks has decreased, but the enormous growth of branch networks has kept
competition strong in local banking markets.
Closer financial integration in Europe has encouraged the market to open up to EU banks,
particularly in recent years, and Italian banks to venture abroad.
In a rapidly evolving sector, the cooperative banks, for their part, have proved extremely
dynamic while evolving in a variety of directions, depending on their different initial situations
and the opportunities offered by their local economies.
One segment of the cooperative banking sector has consolidated its position in its chosen
markets, focusing on internal growth and successfully enacting the role of local bank with
close connections with the fabric of small and medium-sized enterprises. The largest banche
popolari, on the other hand, have concentrated on external growth, carrying out broad
merger programmes, both within their category and outside, by acquiring former savings
banks, local banks set up in the form of public limited companies, banche di credito
cooperativo (mutual banks) and specialized banks. This has led to the formation of medium
and large-sized groups that operate beyond regional borders. In some cases growth has led
- -
to changes in ownership structure and greater market openness as well as entry into new
lines of business.
Both growth paths have greatly reinforced the category of cooperative banks as a whole. In
the last decade, despite a reduction from 56 to 38 in the number of independent banche
popolari and groups headed by banche popolari, their market share in Italy has risen from
16.8 to 21.1 per cent of total bank assets, from 15.9 to 21.6 per cent of lending to residents
and from 21.1 to 27.3 per cent of branches.
There has been a parallel sharpening of differences within the category. In 1998 the five
largest groups headed by banche popolari ran an average of 526 branches, while banche
popolari not belonging to groups had 16 each; today those figures are respectively 1,340 and
23. The average value of the top five groups' total assets was ten times that of the other
banche popolari, a ratio that is now close to 25:1. Of the 16 banking groups headed by
banche popolari, two are among the top five in Italy in terms of total assets and eight are
listed on the stock exchange or have at least one listed member.
The leading groups have adopted a more structured organization, for the most part of the
multifunctional federal type.
2. Cooperative banks in the European context
Cooperative banks are a key component of the cooperative movement in the credit sector,
which originated in Europe in the nineteenth century as a response to the problems that
small urban and rural businesses had in obtaining credit. From the very first credit unions
promoted by Schulze-Delitzsch and Raiffeisen, they adopted an organizational model based
on democratic governance and mutualism. In time, this model evolved and differentiated into
a multiplicity of institutions with characteristics reflecting the needs of cooperative members
on the one hand and the specificities of national legislative frameworks on the other.
Today, the cooperative credit sector in Europe embraces systems that are not entirely
uniform in terms of legal set-up, size and organization. Some systems are strongly
integrated. This is the case in Germany, where the Volksbanken and Raiffeisenbanken are
joined in a single trade association and have common central structures (DZ Bank), and in
the Netherlands, whose cooperative banks are gathered together in the Rabobank group,
one of the country's largest banking groups. Other systems are more highly diversified, as in
France, whose cooperative system includes three of the country's five largest banking
groups (Crédit Agricole, Caisse d'Épargne and Crédit Mutuel) plus the Banques Populaires
group consisting of a federal bank and 20 regional banks with more than 3,000 branches.
Cooperative banks' ability to adapt and to grow in highly diverse economic and institutional
environments has made them a substantial part of the banking industry in many European
countries. Overall, the cooperative banking sector in the European Union counts more than
4,000 local and regional banks, 62,000 branches and 49 million members, with a significant
incidence in their national markets.2 Although comparing international data involves some
difficulty, we can put cooperative banks' market shares in terms of number of branches at
about 60 per cent in France, 50 per cent in Austria, 40 per cent in Germany and the
Netherlands, and 10 per cent in Spain and Portugal.3 In Italy, the figure is 39 per cent for the
entire cooperative banking sector.
In the other European countries, cooperative banks have developed mainly in a context,
including the legal and institutional framework, in which central organizations play a driving
role. In Italy, by contrast, the movement has been marked by greater differentiation between
mutual banks (banche di credito cooperativo) and popular banks (banche popolari), with less
integration and autonomous paths of development being preferred.
Each model has its strengths and weaknesses. Close coordination at central level can help
overcome constraints and inefficiencies due to the small size of individual cooperative banks.
On the other hand, in banking as in other industries, entrepreneurial autonomy fosters
competition, the quest for innovative solutions, and the ability to adapt to the needs of local
economies.
3. Support for the economy
The presence of a varied range of intermediaries constitutes an asset for the Italian banking
system and has proven invaluable for the country's economic growth. In particular, thanks to
the social and solidaristic concerns inherent in their corporate model, Italy's cooperative
banks not only assist categories of customers at risk of exclusion from the credit market and
thus vulnerable to usury, but have also actively sustained specific segments of the market,
such as small and medium-sized enterprises. It is on the basis of these premises that Italian
legislation has always safeguarded the particular characteristics of cooperative banks in their
various forms.
Banche popolari
are the most important expression of Italy's cooperative banks in terms of
assets. A particularly topical debate today concerns the effects that the rapid expansion of
some of these banche popolari may have had on their inclination to support local economies
- in particular, the maintenance of close relationships with their reference customers
(households, professionals, artisans, SMEs) - and on management's incentives.
The empirical evidence testifies to their close ties with local economies and their role in
financing business initiatives.4 These are reflected in the composition of their lending, with 66
per cent of the total going to firms, against 59 per cent for other banks. Comparing the
banche popolari
figures for the five largest banking groups headed by with those for major
and large banks of comparable size, the gap widens to 10 percentage points (65 against 55
per cent).
Strong roots in local economies are a prerequisite for mitigating the difficulties of access to
credit even in hard times like these. Excluding bad debts and repos, lending to residents by
banche popolari and other banks belonging to their groups grew by 6.8 per cent in 2008,
compared with 5.6 per cent for the banking system as a whole. The growth in lending by the
five largest banking groups headed by banche popolari was in line with that of the other
major and large banks. By contrast, lending growth was much livelier for the smaller banche
popolari
(13.9 per cent), also by comparison with other banks of comparable size and with
similar operational characteristics (7.2 per cent) including the mutual banks (10.4 per cent).
The gap between the growth rates of large and small banche popolari is explained in part by
the difference in the intensity of their relationship with firms and local communities, since this
tends to weaken progressively the more banks grow, open up to the market and expand their
range of operations. When there is a significant development of business relationships and
areas of activity, including abroad, there can also be a weakening of the control exerted in
the form of social pressure and in other ways by the local community (customers and
shareholders at one and the same time), so that management's incentives are less closely
aligned with the interests of the community where the bank was originally established.
The support for the economy provided by banche popolari, especially the smaller ones, is a
major strength of Italy's banking system.
However, there are risks that cannot be ignored. An examination of the banking relationships
of a sample of nearly 50,000 firms surveyed by the Company Accounts Data Service shows
that the banks that stepped up their lending most sharply in the last year did so in part by
significantly increasing their exposure to financially fragile firms. The necessary provision of
support to businesses must be accompanied by an objective assessment of the potential of
the projects undertaken and the medium-term prospects. Careful and stringent risk
management is a sine qua non for credit to continue to flow to where it can safeguard valid
business initiatives and contribute to the recovery of productive activity.
4. Technical indicators
The banche popolari's technical indicators - like the main balance-sheet aggregates
analyzed above - point to quite considerable diversification in terms of size and market.
Capital adequacy ratios show no evidence of any particular difficulty overall. The solvency
ratio is in line with that of the banking system as a whole; it is higher for the smaller banche
popolari than for the larger, listed ones.
reflects these institutions' retail specialization, involving broad territorial
Profitability
coverage through a dense branch network. The ratio of operating costs to gross income,
which can serve as a proxy for operating efficiency, was 63.8 per cent in June 2008, about
one percentage point higher than for banks incorporated as public limited companies. This
indicator improves with the size of the bank: it is better for the listed than for the minor banks
banche popolari
(63.1 as against 67.9 per cent). ROE is lower for than for public limited
banks (8 and 10 per cent respectively), and again differs within the cooperative group (8.1
per cent for listed and 7.5 per cent for unlisted institutions). Many cooperative banks, like the
others, recorded significantly reduced profits in the first three quarters of 2008, as a result of
the financial turmoil.
Loan quality is now showing serious effects of the recession, as in the banking system as a
whole. The non-performing portion of the cooperative banks' business loans rose by nearly
half in 2008 to 1.9 per cent, compared with 1.3 per cent at the end of 2007.
The default rate is rising mostly among the smaller and medium-sized banche popolari and
those located in the South.
It is hard to compare the technical situation of cooperative banks in Italy and in the other
European countries where they play a significant role, as the data are scanty and lacking in
uniformity. Table 6 gives some figures; all in all, there does not appear to be any great
difference between the state of Italian and other European cooperative banks.
Some liquidity problems emerged in conjunction with the tensions in the interbank market.
The easing of the strains, the issue of new securities that can be posted as collateral (mainly
through self-securitizations), and the Bank of Italy's emphatic call for the adoption of more
sophisticated risk management and liquidity management systems all contributed to a broad
improvement in the liquidity profile. Steps still need to be taken to develop sound cash
management strategies and to reinforce the organizational machinery, so as to achieve
integrated risk management.
There are some weak points in organization, according to the Bank of Italy's periodic
examinations.
Most of the shortcomings involve the functioning of corporate bodies - compromised, in
some instances, by an uneven distribution of tasks and by unsatisfactory internal debate,
with repercussions on strategy and coordination - as well as the efficacy of management
instruments, the detection and management of risks, and the scope and depth of audits.
Risk management - including operational, legal and reputational risks - has not always been
adequate to the cooperative banks' size and complex business. This applies above all to the
listed banks, which have been subjected in recent years to growing attention and pressure
from the market, particularly as regards the effectiveness of their risk control process.
These anomalies are not generalized, however. The need for improvement is found above all
where governance systems are not entirely efficient, with rigid, crystallized arrangements and
insufficient control over management.
Even where they have not yet affected the other profiles, organizational inadequacies always
indicate a latent, potential risk. As such, these failings are an important signal that should not
be neglected, because they impinge sharply upon growth and competitiveness. Like capital
adequacy, organizational adequacy is a safeguard, the precondition for sound and prudent
management.
5. Governance
The governance of the cooperative banks has been the subject of lively debate in recent
years, with strongly differing opinions and points of view. Fundamentally, the question is
whether these institutions' traditional model of governance is still suitable today, capable of
serving the needs of banks that have grown through mergers to considerable size, with an
increasingly ramified ownership base and open to the capital markets.
The main points under debate have been relaxing the limits to individual equity shares,
strengthening the role of institutional investors, extending proxy voting, and exploiting the
cooperative nature of these intermediaries.
The cooperative banking model appears to be subject to strain above all among the larger,
listed banks, where ownership that is open to the market and to institutional investors
conflicts with rules that, though originally designed to preserve democratic participation,
actually make it hard to contest control, limit the representation of the various shareholder
components in corporate bodies, and discourage attendance at meetings.
On the other hand there is no denying the need to preserve intact the features, peculiar to
banche popolari, that favour a development model oriented to sustaining the local
community.
The proper balance must be struck between the need to preserve the specificity of
cooperation and the need for the model of governance to correspond more closely to these
institutions' size and market orientation. Large and complex institutions, interested in
nontraditional lines of business, should consider the adoption of a more open and dynamic
structure of governance, so as to be able to respond promptly to changes in the business
environment and seize new opportunities, design consistent, comprehensive strategies, and
ensure effective leadership and coordination.
6. Regulation
The legal framework of the cooperative banks in the leading European countries has evolved
with the development of the legal and economic context: in Spain there are extensive limits
on holdings of capital, including by persons other than cooperative members; in Germany
derogations are allowed, in certain circumstances, from the one-person-one-vote rule; in
France multiple votes are permitted in proportion to the size of the contribution of capital,
albeit within limits laid down in the bylaws.
The evolution of the law in Europe has also made it possible to keep up with the
development of the competitive context, without significantly altering the essential
characteristics of the cooperative model, which is still centred on a democratic structure and
mutualistic goals.
In Italy the regulation of banche popolari is still marked by the rigorous interpretation of the
one-person-one-vote rule, the stringent legal provisions governing the limits to holdings of
capital (which can be waived only for some categories of institutional investors), the
nonapplication of the solicitation and collection of proxies, by way of derogation from the general
rules on listed companies.
A balanced and pragmatic evolution of the governance arrangements of banche popolari, in
line with the specific features of each one, needs to be carefully assessed and can be
implemented by means of self-regulation, especially bylaw innovations to make better and
greater use of some options allowed by the applicable company law.
An opportunity can be grasped when defining the governance project provided for in the
supervisory rules on the organization and corporate governance of banks, which the Bank of
Italy issued in March 2008. I am referring to the recommendations aimed at ensuring
adequate representation of the various components of the shareholder base and at activating
mechanisms that will make it easier for members to take part in meetings. In fact, even in the
latest shareholders' meetings (2008) the presence of members of listed banche popolari and
proxies was very low, less than 5 per cent of those entitled to attend except in a few cases.
Suitable ways of giving effect to these legal principles include using slate voting systems for
the election of minority directors and members of the board of auditors; introducing bylaws
that reserve the appointment of a percentage of directors to one or more categories of
members; broadening the scope for proxies to attend meetings (in compliance with the Civil
Code); distance voting; and introducing bylaw clauses on the possibility of holding meetings
in separate locations.
Other issues that are the focus of debate cannot be resolved through self-regulation and are
the subject of various legislative initiatives: the broadening of the limits on holdings of capital;
the assignment of a significant presence of institutional investors in corporate bodies; and the
strengthening of participation mechanisms. One of the aims underlying these initiatives is to
banche
increase the instruments for strengthening the capital bases of the popolari.
In the present financial crisis it is essential to remove every potential obstacle to
capitalraising measures that should prove necessary. The International Monetary Fund has recently
highlighted the risks inherent in the present rules on the limits on the possession of holdings
of capital in banche popolari.5
Members' participation in meetings must be encouraged with instruments that do not distort
the essence of the cooperative form and, at the same time, are in line with the regulatory
evolution under way in Europe, partly as a result of the transposition of the directive on
shareholders' rights.
7. Conclusions
Overall, the world of the cooperative banks is a vital one and able to support the financial
needs of local areas. There are nonetheless broad differences within the category, in terms
of size, type of business and openness to the market.
The model of governance, which overall has allowed these banks to respond to the
solicitations of the competitive environment, may not be entirely suitable for large banks with
a broad and highly diversified shareholder base.
For such institutions the traditional advantages in terms of customer information and relations
deriving from closeness and mutual control performed by member clients are weakened.
Without distorting the banca popolare model, organizational and governance arrangements
need to be found that will compensate for the loss of that competitive advantage and be
more consistent with the increased complexity of such banks' operations and their growth in
size.
The financial market crisis that broke out in the summer of 2007 and grew worse after
September 2008 has led governments, central banks and international institutions to attempt
to analyze its causes and possible remedies, with a view to finding not only immediate
solutions but also more far-reaching reforms of the financial markets, regulation and controls.
-
The most authoritative analyses conducted to date the report of the Financial Stability
Forum chaired by Governor Mario Draghi,6 and the document recently produced by the
-
Group of Thirty7 highlight the central role of governance arrangements and risk
management systems for the stability of individual institutions and the financial system as a
whole. The reforms that legislators and authorities are called upon to carry out, at various
supranational and national levels, will be based on common rules and a greater role for
organizational and corporate governance variables.
banche
In this context the popolari, in the same way as the banking system as a whole, must
grasp the opportunity to accelerate the process of adaptation of organizational arrangements
and internal control systems, remove the problems and enhance these banks' role and
growth potential.
The banche popolari should also play a proactive role and demonstrate the ability to evolve
towards governance arrangements better suited to the demands of stakeholders and the
needs of increasingly competitive markets, while maintaining the spirit of "participative
democracy" that underlay the original regulatory framework.
This is one way to make it possible to perform the traditional function of the economy even
more efficiently, something that is all the more necessary at times of crisis such as the
present.
References
AGCM (2009), Indagine conoscitiva: la corporate governance di banche e compagnie di
assicurazioni.
Banca d'Italia (2007), Concluding Remarks, May.
Berger A.N. and Udell G.F. (1995), "Relationship lending and lines of credit in small firm
Journal of
finance", Business, 68, 351-81.
Berger A.N. and Udell G.F. (2002), "Small business credit availability and relationship
lending: the importance of bank organisational structure", Economic Journal, 112/477,
F3253.
Bongini P. and Ferri G. (2007), Governance, Diversification and Performance: The Case of
Italy's Banche Popolari, paper given at the meeting on Corporate Governance in Financial
Institutions, organized by SUERF and the Central Bank of Cyprus, Nicosia.
Bonaccorsi di Patti E. and Gobbi G. (2001), "The changing structure of local credit markets:
are small businesses special?", Journal of Banking and Finance, 25, 2209-37.
Bonaccorsi di Patti E. and Gobbi G. (2003), "The effects of bank mergers on credit
availability: evidence from corporate data", Temi di discussione, Banca d'Italia.
Cannari L. and Signorini L. F. (1997), Community Links, Co-operative Rules, and the
Economic Efficiency of Italy's Local Co-operative Banks, Proceedings of the European
Regional Science Association, 37th Congress, Rome, Italy.
Capriglione F. (2004), "Le banche cooperative ed il nuovo diritto societario. Problematiche e
prospettive", in Leo S. Olschky (ed.), Atti del Convegno di studio organizzato dalla Banca di
Credito Cooperativo di Cambiano,Florence, 16 October 2004.
Cau G., De Bonis R., Farabullini F. and Salvio A. (2005), "Rischiosità dei prestiti ed efficienza
allocativa: ci sono differenze tra banche popolari e banche società per azioni?", in R. De
Bruyn and G. Ferri (eds.), Le Banche Popolari nel localismo dell'economia italiana (Rome:
Edicred).
Carosio G. (2008), Tavola rotonda: Banche e territorio, Centennary of Credito Valtellinese,
Sondrio, 12 July 2008.
De Bonis R., Manzone R. and Trento S. (1994), "La proprietà cooperativa: teoria, storia e il
caso delle banche popolari", Temi di discussione, 238, Banca d'Italia.
Draghi M. (2007), Politica monetaria e sistema bancario, Ordinary General Meeting of ABI,
Rome, 11 July 2007.
Ferrarini G. (2006), One Share-One Vote: A European Rule?, Working Paper No. 7, Institute
for Law and Finance, Johann Wolfgang Goethe-Frankfurt University.
Ferri G., Masciandaro D. and Messori M. (2000), "Governo societario ed efficienza delle
banche locali di fronte all'unificazione dei mercati finanziari", in P. Alessandrini (ed.), Il
sistema finanziario italiano tra globalizzazione e localismo (Bologna: il Mulino).
Ferri G., Michetti G., Pacioni C. and Tondelli C. (2005), "Banche popolari tra crescita e
localismo" in R. de Bruyn and G. Ferri (eds.), Le banche popolari nel localismo dell'economia
italiana
(Rome: Edicred), 172-298.
Financial Stability Forum (2008), Report of the Financial Stability Forum on Enhancing
Market and Institutional Resilience, April.
Cooperative Banks in Europe - Policy
Fonteyne W. (2007), Issues, IMF Working Paper No.
07/159 (Washington: International Monetary Fund).
Fortis M. (ed.) (2008), Banche territoriali, distretti e piccole e medie imprese (Bologna: Il
Mulino).
Girardone C., Molyneux P. and Gardener E. (2004), "Analyzing the Determinants of Bank
Efficiency: The Case of Italian Banks", Applied Economics, 36, 215-27.
Financial Reform A Framework for Financial Stability,
Group of Thirty (2009), January.
Gutiérrez E. (2008), The Reform of Italian Cooperative Banks: Discussion of Proposals, IMF
Working Paper No. 08/74 (Washington: International Monetary Fund).
Cooperative Banks and Financial
Hesse H. and Cihàk M. (2007), Stability, IMF Working
Paper No. 07/2 (Washington: International Monetary Fund).
Iannota G., Nocera G. and Sironi A. (2006), Ownership Structure, Risk and Performance in
the European Banking
Industry, Universitá Commerciale "Luigi Bocconi," Institute of
Financial Markets and Institutions.
International Monetary Fund, ITALY, Staff Report for the 2008 Art. IV Consultation, 7 January
2009, 18
ISAE (2007), "Accesso al Credito e Riforma delle Banche Popolari", extract from Rapporto
ISAE, Priorità nazionali. Ambiente Normativo, Imprese, Competitività.
Mirone A. (2001), "Le banche popolari negli altri ordinamenti", in AREL, 1-2/2001, 25-30.
Petersen M.A. and Rajan R.G. (1994), "The benefits of lending relationships: evidence from
small business data", Journal of Finance, XLIX/1, 3-37.
Pipitone M. (2005), La disciplina giuridica delle Banche Popolari e i modelli alternativi di
banca, in R. De Bruyn and G. Ferri (eds.), Le Banche Popolari nel localismo dell'economia
italiana, cit.
Pipitone M. (ed.) (2008), Gli statuti delle banche popolari (Rome: Edicred).
Signorini L.F. (ed.) (1999), "Lo sviluppo locale: un'indagine della Banca d'Italia sui distretti
industriali", Donzelli, Temi di Discussione, 347, March 1999.
Turati G. (2004), Are Cooperative Banks and Stock Banks Different Contracts? Empirical
Evidence Using a Cost Function Approach, Universitá degli Studi di Torino.
Tables
Table 1: Summary of data at 31 December 2008(1)
31/12/1998 31/12/2008
(2) popolari
(2)
popolari system % share system % share
Banking groups 23 85 16 81
of which: including listed banks 8 23
Banks belonging to groups 51 115 57 142
Banks not belonging to groups 33 721 22 578
Total groups and independent banks 56 806 6.9% 38 659 5.8%
Total banks 107 921 11.6% 95 801 11.9%
Branches 5,545 26,286 21.1% 9,314 34,178 27.3%
Loans to residents (bn euros) 108 681 15.9% 329 1,523 21.6%
Deposits of residents (bn euros) 110 571 19.2% 240 951 25.2%
(3)
Total assets (bn euros) 238 1,416 16.8% 676 3,196 21.1%
(1) (2)
Does not include Cassa depositi e prestiti SpA. - "Popolari" include limited companies belonging to groups headed by
banche popolari.
(3)
Data for 2008 refer to end-November.
Table 2: Branches
1998 2000 2002 2004 2006 2008
Limited banks and branches of foreign
banks 17,968 19,147 19,880 20,098 20,774 20,756
(1)
Banche popolari 5,545 6,113 6,871 7,388 7,808 9,314
Banche di credito cooperativo 2,773 2,954 3,192 3,465 3,753 4,108
Total 26,286 28,214 29,943 30,951 32,335 34,178
Limited banks and branches of foreign
banks 68.4% 67.9% 66.4% 64.9% 64.2% 60.7%
(1)
Banche popolari 21.1% 21.7% 22.9% 23.9% 24.1% 27.3%
Banche di credito cooperativo 10.5% 10.5% 10.7% 11.2% 11.6% 12.0%
Total 100% 100% 100% 100% 100% 100%
Table 3: Breakdown of lending by sector
(1)
Popolari Other banks
Top 5 Total (2) Small and
Other Large Total
groups minor
Firms 65.4% 68.8% 66.3% 55.5% 70.3% 59.1%
- of which: up to 20 employees 11.3% 15.6% 12.4% 8.8% 16.4% 10.6%
Consumer households 21.9% 24.2% 22.5% 24.6% 21.7% 23.9%
Other sectors 12.7% 7.0% 11.2% 19.9% 8.0% 17.0%
Total 100.0% 100.0% 100.0% 100.0% 100.0% 100.0%
(1) (2)
banche
"Popolari" include limited companies belonging to groups headed by popolari. Includes leading, large and
medium-size banks following the Bank of Italy's system of classification.
Table 4: Lending to firms by size of loan
Popolari(1)
S.p.A. + foreign Credito
of which:
branches coop.
of which: listed
unlisted
0-5m 29.5% 39.0% 37.5% 47.8% 70.1%
5-25m 22.7% 26.5% 26.4% 27.4% 23.1%
> 25m 47.8% 34.4% 36.1% 24.8% 6.8%
Total 100.0% 100.0% 100.0% 100.0% 100.0%
Source: Central Credit Register; data at 31/12/2008.
(1)
"Popolari" include limited companies belonging to groups headed by banche popolari.
Table 5: Twelve-month growth in lending(1)
Dec. 2008
(2)
Popolari 6.8%
- of which: top 5 groups 4.5%
other 13.9%
(3)
Other banks 5.4%
- of which: large 4.9%
small and minor 7.2%
(3)
- of which: BCC 10.4%
Total 5.6%