EU Approves $166 Billion Liquidity Guarantee for Italy Banks
- Support is separate from possible recapitalization for banks
- EU says it’s precautionary, no expectation it will be used
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Italy was given the go-ahead by the European Commission to supply as much as 150 billion euros ($166 billion) in government liquidity guarantees for its struggling banks until the end of the year, according to an EU official.
Liquidity support for solvent banks is a “precautionary measure” requested by Italy, the EU said in an e-mailed statement. The guarantees of senior debt allow lenders to maintain access to financing, often at a better price.