Italy might guarantee up to 15 billion euros of bank bonds: draft decree

The deadly virus outbreak has created a major stir around the world in recent times claiming the lives of more than 270,000 people worldwide

Italy's government is considering providing state guarantees for up to 15 billion euros ($16.26 billion) of bonds issued by the country's banks, a draft decree obtained by Reuters showed on Sunday.

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The document says the move is aimed at "preserving financial stability" in the euro zone's third-largest economy, which is facing its worst recession since World War II as a result of the coronavirus outbreak and measures to halt it.

It would allow the economy ministry to offer support to Italian banks for a period of six months — which can be extended for a further six months if needed — although it will need a preliminary green light from the European Commission. The scheme to guarantee bonds is part of a broader stimulus package which is expected to be approved by the government in Rome in the next few days.

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