Market tensions, which manifested themselves in Italy’s banking sector in recent days, has shed light on the fragility of our financial system, which is plagued by a large amount of non- performing loans on the balance sheets of banks. This situation has existed for a long time, but it became more difficult to contain it in the beginning of 2016, once new European regulations stemming from the second pillar of the Banking Union came into force. Moreover, these new regulations were preceded by the failure of some regional and local Italian banks and the worsening of the global macroeconomic outlook.

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