April 9, 2016 / 11:58 AM / 3 years ago

Italian banks' situation 'difficult but manageable': minister

Italian Economy Minister Pier Carlo Padoan speaks during a meeting with his British counterpart George Osborne (unseen) in Rome, Italy, February 3, 2016. REUTERS/Alessandro Bianchi

CERNOBBIO, Italy (Reuters) - Italian banks can deal over the next two to three years with a pile of bad loans that grew during a deep recession, the country’s economy minister said, adding that the situation of their balance sheets was “difficult but manageable”.

“A two, three-year horizon is a reasonable time frame,” Economy Minister Pier Carlo Padoan told a business conference on Saturday. “Following the crisis, banks’ balance sheets are in a difficult situation - some more than others - but it’s a manageable situation.”

Italian banking stocks have lost 40 percent this year as investors fret about high bad loans amid negative interest rates which are hurting profits.

Reporting by Valentina Za and Francesca Landini; Editing by Mark Bendeich

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