Institutional Analysis: Market Appears to Have Assimilated Windfall Profit Tax for Italian Banks, Yet Extended Collection Risks Persist

Analysts at Berenberg Bank said in a research note that if the Italian government hinted at a one-off tax, the impact of the Italian banking windfall profit tax proposal seems to have been priced in bank stocks, but there is still a possibility of extending the tax until Risks beyond 2023.

The hit to Italian bank shares yesterday suggested that the market sees the tax as a one-off.

The tax could reduce Italian banks’ earnings by an average of about 19 percent in 2024, according to the bank’s estimates.