MILAN (Reuters) - The decision of U.S. asset manager BlackRock to pull out of the rescue of Italian troubled bank Carige makes state intervention more plausible, Moody’s Investors Service said on Monday.
“BlackRock’s withdrawal does not bode well for the efforts to turn around the bank without public money,” Moody’s said in a note.
Italy in January approved emergency measures under which the government could inject up to 1 billion euros in capital into Carige by buying its shares.
The rating agency added that, based on its 2019 estimate, the money set aside accounts for just 0.06% of Italy’s GDP. But Italy’s public finances are already under pressure because of weaker-than-expected economic growth.
“The government will find it difficult to achieve fiscal targets agreed with the European Commission,” it said.
“Further deviation from targets could reignite the confrontation with the European Commission that contributed to rising market tensions last autumn.”
Reporting by Maria Pia Quaglia, editing by Jason Neely