The Countercyclical Capital Buffer (CCyB) rate for the second quarter of 2020 has been set at zero per cent

Summary

Based on the analysis of the reference indicators, the Bank of Italy has decided to keep the countercyclical capital buffer rate at zero for the second quarter of 2020. Specifically:

• In the fourth quarter of 2019, the deviation of the credit-to-GDP ratio from its long-term trend (the credit-to-GDP gap) was broadly negative: about -17 percentage points using the standard methodology set by the Basel Committee on Banking Supervision; and about -10 percentage points according to the methodology developed by the Bank of Italy, which takes into account the specific features of Italy's credit cycle. Similar findings emerge from the analysis of the total credit-to-GDP gap;
• Many other indicators confirm that the Italian financial cycle remains weak. The growth rate of bank lending to households is stable while that to firms, already negative, has decreased again. Although the stock of non-performing loans to firms is falling, it still remains high. The real sector indicators closely connected with developments in macroeconomic-financial conditions are also providing similar signals: the unemployment rate remains high, real property prices are still well below their long-term level.