Itay Shuts Down 2 Failing Banks at Potential Cost of $19 Bln - Reports

© Sputnik / Natalia Seliverstova / Go to the mediabankWorld cities. Rome
World cities. Rome - Sputnik International
The Italian government has decided to shut down two failing banks, thus preventing a bank run, at a potential cost amounting to $19 billion, media reported Sunday.

Euro sculpture stands in front of the European Central Bank, right, in Frankfurt, Germany. (File) - Sputnik International
Two Ailing Veneto Banks in Italy Face Liquidation – ECB
MOSCOW (Sputnik) — The decision to wind up Veneto Banca and Banca Popolare di Vicenza was taken during an emergency cabinet meeting earlier in the day, according to The Guardian newspaper.

The banks' assets would be split into "good" and "bad." Italy’s biggest retail bank Intesa Sanpaolo is likely to acquire the "good" assets, with receiving $5.5 billion from the government as part of the deal.

Veneto Banca and Banca Popolare di Vicenza have long been experiencing difficulties, while the government has tried to recapitalize the two lenders. Earlier this week, the European Central Bank said these two banks were "failing, or likely to fail."

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