The Italian Referendum result is due on December 5th. While a narrow NO win could dispel some uncertainty, a wide NO win could further fuel uncertainty and is unhelpful for banks’ recapitalization plans. If banks are unable to recapitalize, we envisage 3 potential options. (i) Italy could gain the waiver set in the article 32 of the BRRD – straight bail-out to rescue banks in case of “serious disturbance in the economy of a Member State to preserve financial stability”. This would imply systemic risk relief, but we think the waiver is unlikely. (ii) authorities to allow the postponement of the recapitalizations. In this case, we do not foresee imminent bail-in or bailout. There might be potential systemic risk reduction, but the issue would remain, so it would not be necessarily a positive. (iii) authorities to apply bail-in. This could be the most likely scenario, as it would comply with current rules. It is a worst case scenario though as it would increase the risk of a moderate bank run.