The Bank of Italy will soon undertake a statistical survey of bad debts, designed to help banks to do more. It is time that the management of non-performing loans be given resources proportional to their weight on balance sheets, adopting a more business-oriented approach, bank size and operating model permitting.
The very actions taken to mend the global economy have contributed to a new set of challenges, in particular, ballooning sovereign debt ratios. At the same time, inflation is picking up speed, owing to the spike in food and oil prices, and the very tools central banks use to combat inflation run the risk of attracting even more capital inflows into emerging economies.