Italians’ dwindling trust in banks comes to fore as vote nears

Bloomberg

Italian bank executives and central bankers, take note: people trust you less and less. Just 16 percent of Italians have confidence in the country’s lenders, down from an already meager 17 percent in June, according to a poll by the SWG research group of Trieste. Only 24 percent trust the Bank of Italy, plunging from 36 percent in June.
One likely reason: a tortuous bank crisis that caused losses for savers and led the government to rescue three lenders with taxpayers’ money this year. The vanishing confidence is likely to show in campaigns for national elections expected by next spring. Supporters of the populist Five Star Movement and anti-migrant Northern League have the least confidence in lenders and the Bank of Italy among those with a definite opinion, according to the survey of 1,000 adults conducted October 23-25.
Both the banking crisis and the role of managers, regulators and government are likely to come to play a prominent role in the parties’ national election campaigns. Attitudes will also be shaped by an Italian parliamentary investigation into the woes of the country’s financial system. “Bank managers and central bankers might have reasons to fear the results of next year’s vote,” Carlo Alberto Carnevale Maffe, professor of business strategy at Milan’s Bocconi University, said in a telephone interview. “Italians do not like the safety of their savings and bank accounts to be put into question.” “Recent events, including the decision to keep the leadership of the country’s financial institutions unchanged, have left many voters even more upset,” he added.
The dwindling trust came to the fore last month when Bank of Italy Governor Ignazio Visco had to overcome attacks from the ruling Democratic Party to secure a second, six-year term. Party leader and former premier Matteo Renzi led the charge, claiming the central bank under Visco had bungled the financial difficulties.
Still, 44 percent of Democratic Party supporters said they had a great deal or some trust in the Bank of Italy, almost twice the whole sample, the SWG survey showed. Amid the finger-pointing, Bank of Italy banking supervision chief Carmelo Barbagallo told Parliament on Thursday that bad management at Popolare Vicenza and Veneto Banca was to blame for their near-failure and the need for a government rescue.
The SWG poll showed that 40 percent of interviewees also blamed managers for the recent bank crisis, while 28 percent said it was mainly due to regulators such as the central bank and market watchdog Consob. Fifteen percent said it was mainly the government’s fault, SWG said. “The crisis has left deep wounds in public opinion and the level of confidencein banks remains at the lowest,” SWG said.