CRIF Osservatorio Imprese 2024

Credit Risk Rises for Italian Companies as Default Rates Edge Higher

According to the latest analysis by CRIF, a leading provider of credit and business information, the credit risk index for Italian businesses has continued its upward trend, reaching 2.53% in December 2024—an increase of 0.22 percentage points compared to June of the same year. The data, drawn from CRIF’s Osservatorio sulle Imprese and based on a sample of more than 2.5 million businesses, reveals a worrying scenario, especially for joint-stock companies (società di capitali), whose default risk is expected to climb to 3.4% in 2025 and 3.9% in 2026.

Sectoral Weaknesses and Structural Challenges

Industries most exposed to international dynamics—such as automotive, retail, textiles, and food—are seeing the sharpest increases in credit risk. These sectors often operate with already thin margins, making them particularly vulnerable to external shocks. CRIF analysts highlight that sectors with structural challenges or those facing declining operational margins are at the highest risk.

The construction industry, for example, saw a 7.8% drop in credit disbursed to joint-stock companies in 2024, likely due to the expiration of ecobonus incentives. The sector also experienced a notable increase in default rates, rising from 3.11% in June to 3.55% by year-end. Similarly, the textile and apparel sector ended 2024 with a 3.93% default rate—up 0.67 percentage points from mid-year—while also suffering a 5.4% drop in financing compared to 2023

Lending Holds Steady, but Warning Signs Emerge

Despite growing credit risk, the volume and value of loans to businesses remained relatively stable in 2024. The number of loans declined slightly by 0.6%, while total amounts disbursed increased by 0.9%. The slight uptick is largely attributed to the European Central Bank’s reduction in interest rates, which created more favorable credit conditions. Notably, the value of unsecured loans and business loans rose by 4.9% year-over-year.

However, CRIF Ratings CEO Luca D’Amico cautions that rising default rates deserve close attention. “While the overall credit market appears stable, the rise in default rates—though still below pre-COVID levels of nearly 4%—is not negligible,” D’Amico noted. He stressed that the joint-stock companies, typically the most dynamic and credit-worthy segment, are now facing heightened vulnerability due to global instability and mounting geopolitical tensions.

Financial Buffers Under Pressure

CRIF’s analysis also shows that although Italian companies are expected to maintain adequate cash buffers, liquidity is starting to contract. This is due to rising repayments on principal debt and stricter credit policies from financial institutions. Gross operating margins are forecasted to remain around 9% in 2024–2025, just below the 9.5% peak recorded in 2023. Yet, key sectors may see margins shrink by up to one percentage point.

In conclusion, while the Italian credit market has avoided major disruptions for now, the medium-term outlook signals increasing default risk—especially for capital-intensive and internationally exposed sectors. With geopolitical and macroeconomic pressures mounting, CRIF’s data suggests that businesses and lenders alike should brace for a more turbulent financial landscape in the years ahead.

Entering Italian NPE Market is a Newsletter and a Linkedin Group focused on News, Updates, and Insights on Italian Banks, Distressed Credit Markets, Fintech, and Real Estate.

Relevant Links:

https://www.crif.it/ricerche-e-academy/ricerche/market-outlook/osservatorio-crif-imprese-2024-strategie-crescita-aziendale/

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