If the Italians leave the EU, along with the Euro currency, and go back to printing Lira, they can recapitalize their banks by having their new central bank buy up bonds issued by the banks.  Such  bonds may even pay negative rates ( i.e. more money going from the central bank to the Italian banks after it buys their bonds).  This has the advantage that no taxpaper funds are used and no savers get 'bailed-in'.  In the past this would not have been done since it would have caused massive inflation, but since modern inflation is stuck close to zero there would be little risk in giving it a try.  Unfortunately, the problem will be existing debts denominated, and paid back, in Euros.  That will probably require a temporary fixed Lira/Euro exchange rate that will then be allowed to float again after the Euro debts are paid back. The EU is a mess, and disentangling from it is also, unfortunately, a mess too.