War in the Gulf pushes up corporate default risk

The upward trend - constant but gradual and under control - has remained the same for some years: the unprecedented influx of liquidity injected by governments across Europe to cope with the Covid-19 crisis and the years immediately following had allowed Italian companies to reach minimal credit risk rates, below 2% according to the findings of Crif, a company specialising in credit information systems.

It was therefore neither surprising nor worrying to see the gradual increase in this percentage that began at the end of 2022, which on the one hand accompanied the recovery in investments and, on the other, was affected by the continuing uncertainties and economic difficulties of the following years, mainly due to geopolitical and global trade tensions, with repercussions more evident in certain production sectors more exposed to fluctuations in energy and raw material costs, or the drop in demand in strategic markets, such as China. Risk levels have, however, so far remained well below pre-pandemic levels (above 4%), thus causing no particular alarm among analysts.

At the end of 2025, according to the latest update of Crif's Observatory on Enterprises, the average default rate reached 3%, compared to 2.9% at the end of 2024, with a more marked increase for corporations (from 3.1% to 3.3%), which are more exposed to rising interest rates and macroeconomic conditions, while smaller entities (partnerships and sole proprietorships) recorded stable rates of around 2.8-2.9%.

To complete the picture at the end of 2025, on the disbursement front, the Crif Observatory noted an 11% increase in loans to businesses, a figure to be read positively, as it reflects both better conditions of access to credit and the propensity of businesses to invest in order to increase their competitiveness. The stock of outstanding loans also increased, returning to positive ground after a long period of decline. In detail, Crif explained, unsecured loans (without collateral) and general mortgages in particular increased, with a growth of 20%.

This picture, however, has aged prematurely and rapidly since the US and Israeli attack on Iran on 28 February. "Impacting the macroeconomic environment are external shocks linked to the geopolitical situation, in particular the closure of the Strait of Hormuz, with the consequent rise in energy and raw material costs and bottlenecks along the supply chain," notes Luca D'Amico, ceo of Crif Ratings, who highlights the potential risks arising from this situation also for the real economy and the credit health of households and businesses. Indeed, the war in the Middle East - and especially the prolonged blockade of Hormuz - is already leading to a downward revision of global economic growth expectations, a rise in inflation estimates, and a 'potential revision of the ECB's monetary policies'.