Italy Retail Banking: Opportunities and Risks to 2023

Italy Retail Banking: Opportunities and Risks to 2023

Summary

Italy's total loan balances outstanding (including credit card balances, personal loan balances, and residential mortgage balances outstanding) recorded a marginal compound annual growth rate (CAGR) of 1.1% during 2014-18 to reach €714.3bn ($818.2bn). Credit card balances outstanding was the fastest-growing credit segment during the review period. From 2018 onwards, Italy started observing a decelerating economic growth, primarily due to political instability and low levels of investment, making it one of the slowest-growing countries in Europe. Furthermore, Italy is expected to endure continued double-digit unemployment rates, stagnant gross household disposable income, and rising borrowing costs. The debt-averse nature of Italians is also anticipated to prevent the magnitude of overall household debt from rapidly increasing. Consequently, we anticipate the total loan balances outstanding to grow at a CAGR of 1.4% over 2019-23.

Italy's gross household savings rate declined from 10.4% in 2014 to 8.9% in 2018. Coupled with declining deposit interest rates, this led to a slow growth in Italian retail deposit balances. The trend is anticipated to continue over the coming years, with the retail deposit market forecast to record a CAGR of 1.0% over 2019-23 to reach €1.4tn ($1.6tn).

Based on our proprietary datasets, this report analyzes the Italian lending market, with a focus on the consumer lending segment. The report discusses in detail the credit card, personal, and mortgage loan markets, covering market size, competitors' market shares, and survey insights. The report also provides a market overview and insights on the retail deposit segment. In addition, it covers the key digital disruptors in Italy's retail lending segment.

Scope

• Residential mortgage loans in Italy registered a low review-period CAGR of 1.4%, primarily on account of a prolonged decline in housing prices.
• The personal loan market in Italy limped to a review-period CAGR of 0.7%. However, low interest rates and simple application processes will push personal loan balances.
• Despite, credit card debt recording the highest review-period CAGR, the overall credit card balances outstanding remain low in the country due to the debt-averse nature of Italians.

Reasons to buy

• Make strategic decisions using top-level historic and forecast data on the Italian retail lending industry.
• Identify the most promising lending segment.
• Receive detailed insights into lending in Italy, including consumer lending.
• Understand the changing market and competitive dynamics by learning about new competitors and recent deals in the retail lending space.
• Receive comprehensive coverage of the retail deposit market in Italy.