The Restructuring of Banking Groups in Italy: Major Issues

Elisabetta Gualandri

Chapter Chapter 9 in The Recent Evolution of Financial Systems, 1997, pp 157-180 from Palgrave Macmillan

Abstract: Abstract Over the last decade Italian banks have achieved growth and diversification by establishing group structures; they had no alternative since, by strictly limiting the activities of the banks themselves, the 1936 Banking Law forced them to found subsidiaries if they wished to operate in all the different financial service fields. However, in many cases the group mentality and strategic co-ordination were sadly lacking, and there was a signal failure to exploit the synergies and interrelations between the various areas of operation. Groups were merely collections of isolated subsidiaries, with no clear unifying strategic design, and this had obvious repercussions on efficiency. The last few years have seen the reorganisation of the largest groups: the primary objective has been the solution of problems of various kinds linked to the way in which the groups have grown. New links have been established between operations in different geographical areas and fields of business, with takeovers and mergers followed by group restructuring intended to rationalise and/or simplify structures, which have often grown up without any identifiable strategic logic.

Keywords: Credit Risk; Parent Company; Minority Shareholder; Group Company; Risk Control (search for similar items in EconPapers)
Date: 1997
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Persistent link: https://EconPapers.repec.org/RePEc:pal:palchp:978-1-349-14192-0_9

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DOI: 10.1007/978-1-349-14192-0_9

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