Dividend distribution was very prudent, mainly owing to the recommendations issued by the European Systemic Risk Board, the Single Supervisory Mechanism and the Bank of Italy, supported by granular supervisory action. Public loan guarantees contributed to limiting riskweighted assets.
When a higher nominal exchange rate is offset by lower inflation, the real exchange rate stays at the same level. Actual calculation of these rates is admittedly difficult because of issues involved with comparing inflation between economies, but the rates fluctuate considerably over the long term.