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Bank tax hits investor confidence in Italian govt
Italian Prime Minister Giorgia Meloni’s government watered down its surprise windfall tax on banks this week after a brutal market reaction, but the damage to investor confidence was done. “The most damaging impact… will not be the hit to the earnings of Italian banks but the higher risk premium that investors will demand to compensate them for the risk of future government intervention,” noted Johann Scholtz, analyst at Morningstar. Meloni’s hard-right government announced out of the blue on Monday night that it would levy a 40-percent tax on banks’ “surplus profits” generated by interest rate hikes, ... (full story)