Intesa Warning: Italy Budget Could Prompt ECB to Cut Bond Holdings
Key Facts
Carlo Messina, chief executive of Intesa Sanpaolo, warned at a parliamentary hearing on November 12 that Italy’s budget measures could lead the European Central Bank to ask domestic banks to reduce their holdings of government bonds. Messina said central bank officials could later tell banks to cut those holdings under its rules. The dispute centers on tax measures targeting the financial sector and credits linked to home renovations. The government plans to collect €5.9 billion from the financial sector in 2027, with the total rising to €12 billion through 2029. Messina’s warning puts the financing of the Italian state at the center of the debate, as the tax treatment of banks intersects with their holdings of government debt.
Messina said, according to Reuters, that ECB rules could lead to a request to cut government bond holdings, describing it as a measure that could come “after a little while.” He called the situation “tolerance” under the central bank’s rules. The warning reflects concern that disputes over budget provisions could become a supervisory issue affecting banks’ relationship with sovereign debt. The government is seeking a contribution from the financial sector to fund tax cuts and higher spending in next year’s budget. The amount Rome expects to raise totals €12 billion through 2029.
One of the main points of contention is the deferral of the use of tax credits linked to home renovation work carried out in 2023, known as the “Superbonus.” The budget provides for more than €20 billion of these credits to be spread over ten years, rather than made available in 2027 under current legislation. The credits cover financial and non-financial companies, as well as taxpayers. Messina said extending “Ecobonus” credits to ten years was “a South American-style approach to managing debts owed to creditors.” The change puts the timing of access to the credits in dispute, alongside the size of the tax contribution imposed on the financial sector.
The Bank of Italy warned that higher taxes could increase uncertainty and affect investment decisions. It also said deferring tax credits could have a significant impact on financial intermediaries’ income data for 2026. The debate therefore extends to when the financial impact is recorded for institutions covered by the measures. Prime Minister Giorgia Meloni, meanwhile, defended the measure as a matter of fairness. Reuters quoted her as saying that higher taxes come in a difficult economic environment marked by a high cost of living and interest rates.
Trading data show movement in Intesa shares during the hearing, without establishing the cause of the move on their own. Reuters data showed the stock closed down 0.89% on Italy’s exchange on November 12, at €6.246. EL7 data recorded the U.S. trading receipt for the stock, ticker IITSF, closing at $6.95 on the same day. Separately, in the economic backdrop, Italy’s trade balance posted a surplus of €2,083 million in September 2026, according to data published by the National Institute of Statistics on November 13. The surplus figure relates to September, while November 13 is the date the data were published.
The 2027–2029 budget bill entered the parliamentary process after being submitted to the Chamber of Deputies on November 5, according to Italy’s Ministry of Economy and Finance. After review by the lower house, the amended text, if changes are made, will be referred to the Senate for a second reading. Economy Minister Giancarlo Giorgetti said he was open to changes to the budget as the legislative process continues. Reuters reported that Italy is awaiting a legal opinion from the European Central Bank on the budget, without specifying when it will be issued. The ECB’s next Financial Stability Review, which examines potential risks to financial stability in the euro area, is due to be published on November 18.