The�Financial Stability Safeguard Committee' met today to consider the most recentdevelopments regarding tension on the national and international financialmarkets.
Themeeting, chaired by Minister of the Economy and Finance Giulio Tremonti, wasattended by the Governor of Banca d'Italia Mario Draghi, Treasury DirectorGeneral Vittorio Grilli, the Chairman of insurance industry supervisory bodyISVAP Giancarlo Giannini and the Chairman of stock market regulator CONSOBLamberto Cardia.
Thesupervisory bodies reported to the Committee on the development of thefinancial crisis and confirmed the Italian financial system to be fundamentallysound.
Bancad'Italia set out the current position regarding credit to businesses within thecontext of a net deterioration in the economic situation, the signs of whichare beginning to be reflected in credit quality. The increase in bank loans iscontinuing to slow as a result of a decrease in applications for finance forinvestment programmes, with signs of tighter conditions being attached tooffers. The cost to the banks of funding is being reflected in the terms onwhich credit is provided to businesses and individuals.
Thesituation regarding market liquidity is not as strained when compared to lastOctober, in particular regarding shorter-term maturities.
TheCommittee agreed on the need to constantly monitor developments on the creditmarket, evaluating the position regarding both amounts lent and the conditionsattached.