Italian Banking System Overview Problem loan ratio European banks Problem loan ratio Italian banks 20 10 0 17.3% 5.1 % Top 5 Bank by Assets and Market Share Domestic market share (loans) Total Assets €bn 20% 15% 10% 5% 0% 1000 500 250 750 0 827 11.3% 788 19.5% 168 6.2% 144 7.0% 134 4.6% UniCredit Intesa Sanpaolo Banco BPM Banca Monte dei Paschi di Siena Unione di Banche Italiane Distribution of Ratings: Highest Italian Bank Rating is A3 Government of Italy – Key Data Italian Banking System Data Avg. Deposit Rating Baa2 Average Senior Unsecured and Issuer Rating Baa2 Average Baseline Credit Assessment ba2 Outlook Negative Rating Baa2 Outlook Negative Real GDP growth 2017f: 1.3% General Government Debt/ GDP %: 132% *All numbers approximate due to difference in reporting months €349 billion Problem loans 23 Italian banks rated by Moody’s €2.1 trillion Top 5 banks combined assets €3.9 trillion Total Italian banking system assets Problem Loans © 2017 Moody’s Corporation, Inc. and/or its licensors and affiliates. All rights reserved. Data as of 13 October 2017. 12.8% Italian banks continue to face a challenging environment. This infographic highlights the system's large stock of bad debt, and negative outlooks. For more information on Italian banks at moodys.com/italianbanks Italian Banks Funding 67% 24% , 9% Retail funding Wholesale funding Eurosystem refinancing Average CET1 ratio Assets €bn Problem Loans Mostly Come from SME and Corporates Corporate & SMEs Other Residential mortgages Micro enterprises (up to 5 employees) Consumer credit 72% 8% 12% 7% 2% Note: Problem loans and CET1 ratio refer to December 2016, and they are sourced from Bank of Italy and European Banking Authority. Average CET1 includes €22 billion of equity raised by rated Italian banks after June 2017 0 1 2 3 4 5 6 7 A1 A2 A3 Baa1 Baa2 Baa3 Ba1 Ba2 Ba3 B1 B2 B3 Caa1 Caa2 Caa3 Ca C Number of banks