BANCA INTESA: GRATI A STAMPA ESTERA PERCHE' QUELLA ITALIANA E' SEMPRE PIU' SERVILE !

03 Oct 2007 15:53 GMT Intesa Sanpaolo Upgrades Mortgage Rates - Consumer Group Adusbef MILAN -(Dow Jones)- Italy's second-largest bank, Intesa Sanpaolo SpA (ISP.MI), has raised its annual fixed-rate mortgage charges by 0.35%-0.40% from Oct. 1, citing a lack of liquidity due to the subprime mortgage-induced credit crunch, Italian consumer group Adusbef Chairman Elio Lannutti said Wednesday, citing an internal company document. The higher charges are a sign that the credit crunch is resulting in costs for banks which they may pass on to consumers, potentially crimping consumer spending and thereby hurting economic growth. According to an Intesa Sanpaolo memo obtained by Adusbef and seen by Dow Jones Newswires Wednesday, the bank has raised mortgage rates as well as rates on consumer credit loans because its financing costs have increased by "about 15/20 basis points." "Starting in August, financial markets have been affected by significant tensions due to the 'subprime' mortgage crisis," the bank's internal memo said. "Repeated intervention by the central banks brought the situation partly back to normal for short-term liquidity. But it did not have the same effect for medium- and long-term financing, which continues to be difficult to obtain." "Considering that this particular situation is continuing, it is necessary to increase the standard conditions for the catalogue of fixed-rate financing," the memo said. Italian banks have repeatedly said they are not directly or indirectly exposed to U.S. subprime mortgages, and Italian regulators have confirmed that this is the case. However, like all banks in Europe, Italian banks are affected by tighter credit conditions in the wake of the crisis. The bank has raised its charge for an uncollateralized Prestintesa loan - described by its Web site as a personal credit loan to finance "any type of spending" - to 8.25% from 7.25% previously, effective Oct. 1, according to the document. Fully collaterized Prestintesa loan rates were also hiked by 1%, to 7.25%, the document stated. "It's a scandal that a bank with a 22% market share can increase costs for thousands of consumers in this manner with just a wave of its hand," said Adusbef's Lannutti. Italian bank charges are already higher than the European average, according to Adusbef's figures. An Italian mortgage costs its buyer an average of 5.96% in interest rates, whereas the European average is 4.90%, according to Adusbef. Intesa Sanpaolo wasn't immediately available for comment Wednesday. -By Jennifer Clark, Dow Jones Newswires; +39 02 58 21 9904; [email protected] (END) Dow Jones Newswires 10-03-07 1153ET Copyright (c) 2007 Dow Jones & Company, Inc.

04/10/2007

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