- Italian savings banks, foundations tackle diverse needs of regions
- Foundations: €50 million in grant funds to sustain non-profit organisations, boost much-stained national health system
>> Learn more: ACRI response to Covid-19 in Italy
>> Read: Related story Covid-19 efforts by WSBI-ESBG members
>> See: WSBI-ESBG member banks help during Covid-19
BRUSSELS, 12 June 2020 – Covid-19 arrived quietly to Italy. Like countries around the globe, the virus quickly spread and showed its deadly effects. Severely tested by the coronavirus outbreak, Italy took strong measures to contain the spread of Covid-19. As the government addressed the pandemic, WSBI-ESBG Italian member “Associazione di Fondazioni e di Casse di Risparmio Spa”, or Acri Foundation, joined with its 13 member savings banks and 83 foundations of banking origin to swiftly mobilise themselves to help the country of 60 million people tackle the health emergency, serving the needs of the regions spread throughout the country.
Role of Acri member banking foundations during Covid-19
Individual member foundations allocated since the crisis hit funds valued at more than €130 million to help and constantly keep in contact with their respective regions to step in when need arises on the ground. For the most part, these resources have been made immediately available for
hospitals and healthcare companies to purchase much-needed intensive care unit systems, respirators, monitoring systems, beds for resuscitation and everything needed to respond to the emergency during the tense period. There are also interventions in support of non-profit and cultural
organisations hit by the required measures to contain virus spread. Post-emergency, initiatives support economic recovery and scientific research.
National Joint Initiatives Fund: Acts quickly when Italian emergencies surface
Past emergencies Italy faced, such as earthquakes in Abruzzo, Emilia-Romagna and Central Italy as well as flooding in Sardegna and Venice, made WSBI-ESBG member Acri decided to launch a joint intervention among its members through
the National Joint Initiatives Fund. The effort lists two criteria to receive fund assistance: 1.) A time horizon that does not look only at the immediate future but also at the post-emergency period, and 2.) addressees the needs of those who already enjoy strong relationships and partnerships with member foundations.
'Third sector' support fund fills need, ultimately helps vulnerable people
The Acri Executive Committee recently has deliberated the activation of a f und to support the financial needs of the Third Sector organisations. a fund to support the financial needs of "Third Sector" organisations. With a starting endowment of €5 million, the fund will allow the allocation of tens of millions of euros – reimbursable in max 18 months – bringing liquidity to thousands of organisations. Furthermore, there could be more voluntary contributions from individual foundations to enhance fund capacity.
This action by Acri stems from third sector bodies needing help as they fell out of the scope of government efforts as business sector needs were addressed through extraordinary measures aimed at containing economic side effects felt by industries from the health emergency. Beside of suffering the knock on effects from business shut down, the third sector also suffers from structural weakness and fragility on the financial side. That challenge accentuates in a phase where third-sector groups help more vulnerable population segments. Without financial support, third sector groups risk ceasing their much-demanded, human-centred programmes.
ACRI member savings banks help people through Covid-19
ACRI member savings banks and foundations act by their own initiative, in accordance with the Italian banking sector and to implement government and regional institutions’ measures against and in response to COVID-19.
Those measures include bank branches reorganised to react more quickly to client requirements and provide proper support.
For private individuals: Banks have paid unemployment benefits in advance, and/or salary support. They have temporarily frozen private individuals’ loans for people with a low annual gross salary or for those who have lost their job.
For enterprises: Under the government guarantee scheme, banks have set up for companies new access to finance – credit lines and loans. An agreement between the Italian banking sector and trade entities blueprinted a debt moratorium in favour of small and medium-sized enterprises (SMEs). Regional and local programmes have been planned by banks (also in collaboration with regional entities) to boost local business, facilitate economic activities promptly and respond to urgent needs of private individuals.
For non-profit organisations: The Italian foundations with a banking origin have set, in accordance with a primary bank, an amount of about EUR 50 million to sustain the non-profit organisations and to strengthen the national health system to tackle Covid-19.
ACRI: Committed to social utility, promoting economic development
From 2000 to 2019, Foundations associated to Acri have disbursed more than €24 billion through more than 400,000 initiatives and invested significant resources to pursue the mission objectives indicated by law: social utility and the promotion of economic development. The resources used to carry out the projects of the Foundations are drawn from the profits generated by the investments of their assets, which overall amount to around €40 billion. >> Learn more about ACRI
Foundations of banking origin intervene in different fields from welfare to art and culture, from innovation to sustainability, from primary education to scientific research. Each Foundation operates in its own territory, generally the province or region in which it is based. However, there are also many national and international initiatives, carried out under the coordination of Acri. Among the major joint projects, there are:
The fund for the fight against child educational poverty, the largest active intervention in Italy to respond to the phenomenon of child poverty;
Fondazione Con il Sud, to promote the activation of social cohesion paths and good networking practices to encourage the development of Southern Italian regions;
The vast social housing plan, which foundations carry out throughout Italy together with Cassa Depositi e Prestiti.
Acri’s members have launched many other joint projects in different fields as art and culture, environment, innovation and research ais well as international cooperation.
Italian savings banks join those in Europe: Standing with people, communities, regions
During the corona crisis, savings and retail banks in Europe reported to ESBG that loan deferrals and moratoria help both private and corporate clients. Member banks have issued a flood of new loans despite the economic downturn and set up online payment solutions and digital platforms for small- and medium-sized firms. On payments, savings and retail banks upgrade debit cards to execute contactless payments. People's income streams are smoothed out thanks banks paying unemployment benefits and pensions in advance. Commissions for the use of ATMs have been eliminated.
Specific examples from ESBG members include:
FRANCE: Savings banks form the leading private financier in the public hospital sector. Referred to as Caisses d'Epargne, they have mobilised to respond to new challenges linked to the health crisis brought on by Coviid-19. >> See story
GERMANY: German savings banks in March issued €17 billion new loans to companies, self-employed and private individuals, a 22.3 per cent spike compare to March 2019. The "Sparkasse" granted by end of April some 309,000 deferrals for customers regarding interest and principal payments. To help keep local high-street shops afloat, savings banks offered customers a chance to buy gift cards to redeem at participating shops at a later date. >> See story
LUXEMBOURG: Until mid-May, banks granted moratoria on loan repayments to more than 14,000 companies, amounting to €3.4 billion, thereof 20% on the account of ESBG local member Luxembourgish savings banks – BCEE, known locally as Banque et Caisse d'Épargne de l'État.
SPAIN: Funds totalling more than €47 billion were mobilised through mid-May via new loans and other forms of financing.
>> See how WSBI-ESBG members help during Covid-19