Italy’s Big Banks Head Into Earnings on the Cusp of Deal Wave

As Italy’s largest banks get ready to report results, what matters most to investors isn’t profit or revenue. It’s deals.

The country’s lenders have been swept up in a wave of proposed transactions that could result in a fundamental transformation of the industry. But a complex of cross-holdings, alliances and sometimes conflicting interests means that movement on one deal has repercussions for the rest.

The potential deal value amounts to more than €140 billion in combined market capitalizations, according to calculations from Bloomberg Intelligence analysts including Lento Tang. The projected overall synergies are close to €2.5 billion, the ...