Italy’s Prime Minister Giorgia Meloni holds her end-of-year news conference in Rome, Italy, December 29, 2022. REUTERS/Guglielmo Mangiapane/File Photo
ROME, Aug 3 (Reuters) – The party of Italy’s Prime Minister Giorgia Meloni on Thursday proposed a levy on banks to curb variable mortgage costs, saying the increases in interest rates are especially weighing on those already struggling to pay back their loans.
A report from research institute Censis showed almost 71% of families owned the houses where they lived as of 2021, and real estate ownership was considered a “constituent element” of Italian society.
Senator Matteo Gelmetti, from Meloni’s Brothers of Italy party, said some 80% of families holding non performing mortgages had opted for variable rates, and were therefore the most vulnerable to the effects of rate hikes.
The proposed bill, seen by Reuters, says any rises in interest rates for loans agreed in 2023 to buy “the primary home” should not exceed 2 percentage points of the amount initially indicated.
It said a fund will finance the cost-capping scheme through a levy on banks which would amount to 20% of the revenues lenders generate this year through their loans, if these are above 5 million euros ($5.46 million).
“Banks had extra profits compared to previous years,” Gelmetti, who signed off on the proposal along with five other Brothers of Italy senators, told Reuters.
The Italian government has been vocal in criticizing the European Central Bank over repeated interest rate hikes, as they make it more costly for Italy to service the euro zone’s second largest debt pile amid fears they will trigger a recession.
Last month, Deputy Prime Minister Matteo Salvini said the government was working with banks to soften the impact of rising interest rates for variable rate mortgage holders, aiming to lengthen the maturities to avoid increases in monthly payments.
The proposal will need approval from both the Senate and the lower house Chamber of Deputies.
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Reporting by Angelo Amante and Giuseppe Fonte
Editing by Alistair Bell
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