Europe’s next headache: Italy’s banking crisis

Italy’s distressed banking sector is quickly becoming a source of great concern throughout Europe’s financial markets. Angelo Baglioni breaks down the crisis as an outcome of two factors: bank mismanagement and the insolvency generated by a deep recession, which have caused bad loans to soar to unprecedented levels. He concludes it is reasonable to expect that the EU institutions will allow Italy to support its banking sector with the European regulatory frameworks.