Monte dei Paschi di Siena, Italy's third-largest bank, is only one of many Italian banks struggling to pay off bad debt. As Southern European economies fall further into disrepair, tension between the region and its northern neighbors is rising.
(GIUSEPPE CACACE/AFP/Getty Images)
The British vote to leave the European Union has begun to take a political and economic toll on the Continent. Italy's biggest banks, already weighed down by a crushing amount of bad debt, saw the value of their shares and stocks tumble in the referendum's wake. Spain and Portugal, meanwhile, have failed to reduce their deficits enough to meet EU targets, drawing the ire of Northern European countries that fear Britain's departure will boost the influence of Southern Europe's struggling states.
Neither of these problems is new for Europe, long split between north and south, but both will become more important -- and more divisive -- as Britain prepares to exit the union. To hold the crumbling bloc together, European officials will try to broker compromises as best they can, trading long-term solutions for temporary stability on the Continent....