BoE warns Italian bank crisis could spark 'doom loop' for UK

UK exposured to Italy via German and French banks

The Bank of England has warned that a banking crisis in Italy could trigger a "doom loop" which could threaten the financial stability of the UK.

Officials from the BoE have voiced concerns that a problems with Italian lenders could spread across the eurozone and hit the UK economy through French and German banks, The Telegraph reports. Both French and German lenders have huge exposure to Italy; BNP Paribas had some €9.8bn (£8.7bn) of exposure to Italian sovereign debt at the end of 2017, BPCE had €8.5bn and Crédit Agricole had €7.6bn, accord to The Telegraph. Though the UK does not have much direct exposure to Italy, its connection to French and German banks is stronger, so the contagion could eventually hit the UK financial s...