The recent financial turmoil spurred by the collapse of Silicon Valley Bank, Signature Bank and Silvergate Bank in the U.S., as well as Credit Suisse in Europe, has our clients asking: “Is my money going to be safe in an Italian bank account?”. We’d like to provide some reassurance that the Italian banking system is solid, not least because it is part of the broader banking system of the European Union, which has both the willingness and the means necessary to protect its depositors. EU banks adhere to Basel III rules, which impose stringent capital requirements in order to minimize the risk of financial distress spreading across the financial system.
Even in the remote scenario in which the financial distress spreads to an Italian bank, the Italian financial system is designed to protect depositors. Similarly to the US, where deposits are insured by the FDIC up to a certain amount, Italian deposits are insured by the FITD (Fondo Interbancario per la Tutela dei Depositi) for national banks and the FGDCC (Fondo di Garanzia dei Depositanti del Credito Cooperativo) for cooperative, regional banks. The insured amount is €100,000 per depositor, per bank.
If you have more than €100,000 in your Italian bank account and want to be cautious with your financial assets, we advise you to deposit part of your savings with a second Italian bank. This will ensure complete coverage of your Italian deposits. While we are not financial advisors, we generally advise our clients who have moved to Italy for retirement to keep at least one bank account in their country of origin. While this might come at a slight annual cost, most clients find greater peace of mind in knowing that their savings are not managed by a single institution in a single country.
