One of the world's largest investment houses has said it would prefer to see Italian banks, which are labouring under €360bn of non-performing loans accounting for 18% of their total assets, bailed out by the state rather than see bondholders "bailed in" first to recapitalise the system. Strict adherence to the new European Union directive on bank resolution, which has applied since January 1, would require bail-in of up to 8% of all liabilities in a troubled bank before taxpayer money is used to prop up such a lender.
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