Italy

As Monte dei Paschi di Siena’s shares gyrated last week, losing up to 34% of their value, the bank received a high honour, for a second year running — top primary dealer for Italian sovereign bonds.

Non-performing loan ratios in all major European banking systems either improved or remained level in 2015, except for Italy’s.

The treatment of senior unsecured debt in Germany and Italy has led to the downgrading of a number of banks' ratings by Moody's.

Trading in Saipem, the Italian oil and gas engineering company, had to be suspended on Monday, the first day of the firm’s €3.5bn rights issue, due to heightened volatility in the stock.

Shares in Saipem, the Italian oil and gas engineering company, fell to a new 14 year low today, after it released the pricing details of its €3.5bn rights issue at midnight on Thursday.

UniCredit has offered to buy back up to €1.8bn of subordinated bonds mainly held by retail investors for the third time this year, as it looks to clean up its capital structure.

The economies of Italy and China do not appear to have much in common. Italy’s government would welcome a GDP growth rate of 1%, while China expands at less than 7% and investors take flight. One is a sclerotic, decaying Western country, the other is a dynamic Asian tiger. Such is the conventional wisdom.

Renewed concerns about Italian banks’ high levels of non-performing loans triggered a severe sell-off of their subordinated bonds this week, as the market enters the new bail-in era.

Italian investment manager Anthilia Capital Partners expects to close a €230m fund to buy domestic corporate minibonds early in February, a move that could entice players outside Italy to participate.

Italian energy company Enel has signed a financing agreement with Bank of China, which will exchange a $1bn credit line for Chinese access to Enel's future projects.

Southern European lenders are back on the defensive as a European Central Bank inspection of non-performing loans drives a pronounced sell-off in equities and subordinated debt.

The ECB can’t risk large disruptions in the European capital markets it is trying to support, nor paranoid doom spirals in the banks it supervises. So it needs care when and how it communicates with the market.