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The Italian banking system

Italy: Bank of Sicily

. Italy, like other nations, was heavily affected by the economic crisis, but the Italian banking system, with the exception of Unicredit, seem to be much stronger than their international counterparts. Indeed, the investments of the Italian banks turned out to be more conservative, and safer than originally thought: traditionally, Italian institutions have been very cautious in terms of cash, and Bank of Italy has always exerted direct control over the system. This allowed and continues to allow proper cash flow, as well as  putting a lid on dangerous banking operations. This has resulted in the Bank's ability to avoid those dramatic personal and corporate disasters that have occurred elsewhere.


This conservative structure clearly influences everyday services, too. Credit cards are given with the warranty and coverage of a solid bank account and personal assets; mortgages and variable loans usually require a significant down payment; and most importantly, the actual legalities of opening an account are taken very seriously. The paperwork is often tedious and frustrating, especially if someone is used to the American system. Bank branches are key in the Italian system, as they are actually the ones handling the accounts, rather than central headquarters, and although transactions can be made over the internet or at any branch, certain things can still only be done at the agency where the account was originally opened. This creates slowdowns, but it also personalizes the relationship between the customer and the bank, as well as making transactions more secure.


The Internet is fully implemented into the banking system, and many banks provide services that are secure and highly advanced. One of the downsides of opening an account in Italy is the cost itself of opening and maintaining it. Some fixed costs are imposed by the government, and are impossible to go around; in addition, anything related to bank affairs, including sending out bank statements, is charged against the account. This is quite unpleasant, especially when internet access allows real time data, making  paper statements obsolete and an unnecessary expense. More and more banks, though, are favoring online banking and offer the possibility to receive statements online only, if requested.

It is hard to find the perfect banking system: Italy's  has proven to be solid in terms of protecting assets, yet too slow for everyday transactions and business needs. Some could say "better safe than sorry", while others argue "better exposed than flat". The truth is probably somewhere in the middle, but one thing is for sure: Italian banks are not competitive on the international markets. Yet, in a moment of financial danger such as now, having a solid institution behind one's savings may be the better investement of all.

What do you think ?