ABSTRACT
Italy's banking crisis is different from all the other banking crises that have unfolded since the eruption of the great financial crisis in Europe. Behind Italy's banking crises lay many factors, both macroeconomic and microeconomic although the macro ones dominate. Italy's banking crisis is mainly the result of the macroeconomic policies followed after the banking crises in other countries had erupted and the consequent so-called sovereign debt crises. The microeconomic factors behind the crisis are related to the modalities in which the passage from a public separated banking system to a private universal one occurred. Italian bankers were accustomed to very strict legislation that specified, in a way that was reminiscent of socialist and planned economies, the conditions under which credits should be conceded. The return to universal banking in Italy, required by the new European Union regulation, has occurred in a way that has increased the average dimension of banks.
