banks that have already decided on such interventions. moreover, the fund could purchase securities issued as part of bad debts securitizations, thus reducing their volume without weighing too heavily on banks ’ balance sheets. it is expected that the fund will raise resources equal to at least €4 billion from banks, insurance companies, foundations and other institutional investors. it will be managed by a company that is independent from the investors in the fund itself. the operation is currently being evaluated by the ecb. given that it is an independent initiative of a private nature, it is in line with the european rules on state aid. the ministry of economy and finance has informal contacts with the european commission to which it has described the project ’ s key characteristics. bis central bankers ’ speeches for these important projects to be successful additional complementary measures will be required. in the first place, banks must improve their internal procedures for managing non - performing loans. in many cases, the resources allocated to this have remained virtually unchanged since before the crisis, despite the fact that the share of non - performing loans has tripled. banks must therefore devote new human and financial resources to optimizing the management of these assets. in the context of european financial supervision, the bank of italy has been working for some time to persuade banks to make significant progress on this front. we have recently started a statistical survey on bad debts, designed to encourage banks to digitalize their records so as to optimize the management of non - performing loans, whether they intend to sell or recover them. in the second place, progress is still needed to make both judicial and out - of - court recovery proceedings faster and more effective, an area in which italy is at a particular disadvantage by international standards. i have recently emphasized that if we can cut credit recovery times by two years, we can considerably reduce, even halve, bad debts as a proportion of total loans. last august the government approved a reform package that is providing an important boost to the efficiency of the credit recovery mechanism. but more can be done. there is no real conflict between creditors ’ and debtors ’ rights : recovery times in line with international best practices ultimately lead to better conditions for bank customers and an increase in the availability of credit. the government ’ s announcement of further measures to make the procedure for recovering non - performing loans faster and more effective is a step in this direction. in 2015 banks ’ profitability showed signs of improvement : roe returned to positive territory ( about 3 per

capital increase, now under way. the bank of italy ’ s supervisory action, ensuring continuity with the past but now endowed with more incisive powers under crd iv, brought about the replacement of the bank ’ s president and most of its senior executives and is currently monitoring the implementation of a more radical reform of corporate governance that began with the bank ’ s transformation into a joint stock company and will be completed with its stock market listing. as regards other banks, delays and resistance on the part of the governing boards have gone hand in hand with a marked worsening of their corporate profiles, particularly their credit risk, and an unwillingness on the part of the market to provide capital support, inevitably resulting in the appointment of a special administrator. this is the case of the four banks placed under resolution in the month of november. before discussing these banks in greater detail i would like describe briefly the changes that have affected the management of banking crises and determined how these situations are handled. changes to the framework for banking crisis management before 2015 the bank of italy ’ s objectives in handling banking crises were to minimize the impact on customers, the payment system, and the banking system as a whole. in many instances, extremely fragile banks were taken over by healthier ones. when a bank was likely to fail, special administration was set in motion and in the worst cases the bank was wound up. bis central bankers ’ speeches special administration can only take place if the legal conditions for it are met ; these include serious violations of regulations, serious irregularities of management, and serious capital losses. the definition of serious applies to irregularities and violations of the law which have a wide - ranging impact on the bank ’ s situation ( for example, repeated violations of antimoney - laundering legislation, serious and frequent conflicts of interest, and opaque ownership structures ), which must cease as soon as possible, and which the bank is unlikely to be able to rectify on its own. capital losses are considered serious when the regulatory minimum capital adequacy ratios are not observed. special administration does not come out of the blue. as a rule, it is preceded by intensive discussions with the bank of italy ’ s supervisors, repeated attempts to remedy the situation, and a number of inspections, the last of which usually ascertains that it is no longer possible to restore normal business conditions or comply with capital adequacy ratios. this is what happened in the case of the four banks for which a resolution procedure was activated and for