Moody's: Negative outlook for Italian banks reflects continued fragility of their balance sheets

Moody's credit rating on Italian banks was as follows:

• The negative outlook of Italian banks reflects the continued fragility of their balance sheets.
• Moody's maintained its negative outlook in light of the fragility of balance sheets as banks face increasing pressure to reduce their problem loans.
• We expect a further decline in new problem loans in 2018, which will reduce the charges of loan losses and support profitability.
• Italian banks' balance of problem loans in December 2016 was € 349 billion, the largest in Europe, representing 17.3% of total loans.