Eurozone bailout fund 'not preparing' any Italy aid

The head of the European Financial Stability Facility (EFSF) – the eurozone's bailout fund – dismissed suggestions on Friday (9 December) that a bailout package was being prepared for Italy, adding that one had not been requested either.

Speaking in Helsinki, Finland, two days after Italian newspaper La Stamp reported that the country's government was poised to approach the European Stability Mechanism (ESM) for a €15bn (£12.6bn) loan, Klaus Regling, chief executive officer of the EFSF, told reporters: "We are not preparing anything. There are lots of rumours around... but this is not the case.

"Furthermore, we have not been approached by the Italian government for any help either."

Regling also said Italy was not facing a problem that is plaguing the entire banking sector in the country, but that some individual lenders may need to raise more capital.

"This is not at all like in 2009 or 2010 [the years following the global financial crisis] when we had several European countries with countrywide banking problems. Italy is not in that situation today. Banks are stronger; they have used the last few years to strengthen their capital."

However, Regling stressed that instruments were available to respond to any future emergency. "In theory, we are available to take capital in banks, to do direct banking capitalisation. We supported the Spanish banking system in 2012. But again, this is not under consideration for Italy."

Earlier this week, Italian Prime Minister Matteo Renzi stepped down after losing a referendum aimed at constitutional reform in the country. The turmoil may threaten the recapitalisation of Monte dei Paschi di Siena – Italy's third-largest bank.