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Is eurozone consolidation happening behind the scenes?

A crisis is forcing a spike in small bank mergers in Italy. It is a more tentative trend in Germany, although these banks’ common desire for independence might make such crises inevitable.


Talk about bank mergers rarely comes to fruition – especially in Germany and Italy, where it is most needed. A degree of cynicism about bank consolidation is therefore forgivable.

However, when Euromoney speaks to Ignazio Angeloni, board member at the ECB’s Single Supervisory Mechanism, he says that bank consolidation is happening quite rapidly, especially in Italy and Germany; albeit mainly among the small banks, particularly the mutual lenders.

If true, this is nevertheless important, as the continued independence of hundreds of small, often politically linked local banks is a big reason for the sector’s low profitability and sometimes poor governance. 

His comments spring from our discussion about the dangers of ECB-induced low interest margins and poor asset quality, and how mergers could help.


A look at the data shows Angeloni is partly right. Consolidation is happening more rapidly than ever in the Italian cooperative bank sector but not in the German cooperative and savings banks networks, even if mergers there have started to pick up.

That is in sync with what seems to be happening in Italy’s savings banks – as in the recent UBI Banca and Crédit Agricole Italia takeovers – and in the mid tier, with the Banco Popolare/BPM merger. 

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