A Banking Crisis in Miniature: San Marino in Race Against Time

In the shadow of Italy's banking crisis, a much smaller financial emergency is unfolding in the tiny nation of San Marino, a wealthy enclave of 34,000 people perched on the picturesque slopes of the Apennines mountains, the International New York Times reported on a Reuters story. The central bank of San Marino, a former tax haven landlocked inside central Italy, plans to inject liquidity into its ailing lenders, a first step toward overhauling them and finding new equity capital, said a source close to the matter. The banks are burdened with 1.8 billion euros (£1.5 billion) in gross bad loans, a drop in the ocean compared with those of Italy's troubled banks but equal to 113 percent of San Marino's annual gross domestic product - enough to threaten its economy. The republic, which opted out of joining the new Italian state in the 19th century, is less than 15 km (9 miles) from one end to the other. Nevertheless, it has no fewer than six banks, a legacy of its days as a discreet place where foreigners, especially Italians, parked their savings. Read more. (Subscription required.)