Ignazio Visco: Conditions of Italian banks and challenges posed by regulatory developments

Speech by Mr Ignazio Visco, Governor of the Bank of Italy, at the Annual Meeting of the Italian Banking Association (ABI), Milan, 12 July 2019.

The views expressed in this speech are those of the speaker and not the view of the BIS.

The economic situation and outlook

The world economy is struggling to regain momentum. According to the main international institutions, GDP growth this year will be at its lowest since the contraction of 2009. In the Economic Bulletin that will be published this afternoon, the pace of international trade growth is estimated to be 1.5 per cent, more than two and a half points lower than in 2018. Downside risks linked to protracted trade tensions, the slowdown in the Chinese economy, and the unknowns surrounding the timeframe and arrangements for the United Kingdom's exit from the European Union, are weighing on the economic outlook.

Growth remains weak in the euro area. The uncertainty regarding the world economy is having a negative effect on exports, manufacturing production, and firms and households' expectations.