Prime Minister Matteo Renzi has threatened to resign if voters reject his constitutional reform, likely fuelling political instability and spooking financial markets, which would make it hard for lenders to raise the capital they need.

Weakened by a deep recession that left behind 356 billion euros ($377 billion) in gross problem loans, Italian banks need at least 20 billion euros in capital in the coming months to cover losses from fresh loan writedowns and planned bad debt disposals.

Capital needs could almost double if banks tried to raise provisions on so-called "unlikely to pay" and "past due" loans to the 40 percent level the European Central Bank has imposed on weak link Monte dei Paschi di Siena (>> Banca Monte dei Paschi di Siena SpA).

Italian banks' combined provisions currently cover 27.5 percent of the value of those loans, well below a 59 percent coverage ratio on bad loans, according to central bank data. Consultancy PwC recently warned "unlikely-to-pay" loans are likely to turn into bad loans if they don't revert to performing within one year.

Uncertainty ahead of the vote has prevented Monte dei Paschi from securing firm investor commitment so far for a 5 billion euro cash call it needs to carry out this year to stave off the threat of being wound down.

Sources have said bigger rival UniCredit (>> UniCredit SpA), Italy's biggest bank by assets, will wait until February 2017 before seeking to raise as much as 13 billion euros in a share issue.

UniCredit, which has assets outside of Italy, is expected to weather any market storm, but Banca Carige (>> Banca Carige SpA), Popolare di Vicenza and Veneto Banca are also at work to shed bad loans and investors worry a "No" victory would hamper possible cash calls.

Following is a summary of trouble spots in Italy's banking sector:

1. MONTE DEI PASCHI DI SIENA - Italy's third-largest bank emerged as Europe's most vulnerable lender in industry stress tests in 2014 and again this year.

Monte dei Paschi has the highest proportion of bad loans among Italian lenders both as a share of total loans and compared to its capital.

Its balance sheet has been wrecked by the costly acquisition of a regional rival on the eve of the global financial crisis, large losses from derivatives trades and loan writedowns.

The bank, which has burnt through 8 billion euros in capital raised in successive shares issues in 2014-2015, has warned it may not be able to remain in business if it fails to gather the proposed 5 billion euros.

Monte dei Paschi needs the money to offload 28 billion euros in gross bad loans and improve provisions on remaining doubtful loans.

2. BANCA POPOLARE DI VICENZA/VENETO BANCA - The two unlisted regional banks were rescued this year by state-sponsored, privately funded bank bailout fund Atlante after failing to raise a combined 2.5 billion euros in initial share offerings.

They are now estimated to need as much money to cut impaired loans totalling 17 billion euros before looking for a potential buyer or be allowed to merge - a move they are considering.

The two banks are vulnerable to deposit flights and have unsustainable costs that eat up virtually all their income, their owner Atlante has said, meaning they may face the threat of being wound down if unable to raise capital.

3. BANCA CARIGE - The Genoa-based lender is working on a 1 billion euro bad loan sale as it seeks to comply with a European Central Bank request to cut its soured debts.

Shares in Carige trade at less than one tenth of the value of the bank's tangible assets as investors worry it will need to issue new shares to boost capital.

Together with Monte dei Paschi, Carige is the only Italian bank that was forced to tap markets for cash as a result of the 2014 stress tests. The bank raised 850 million euros in a share sale in early 2015 following another 800 million euro cash call in July 2014.

4. FOUR RESCUED BANKS - In November 2015, Italy rescued from bankruptcy Banca Etruria, Banca Marche, CariFerrara and CariChieti, writing down the value of junior bonds and shares in the four small banks and drawing 3.7 billion euros from a deposit-guarantee fund financed by the country's lenders.

Italy has struggled to find a buyer for the loss-making banks, which have also seen their problem loans worsen further since the rescue even though the worst bad loans had been spun off.

Sources have said the ECB has given a green light to UBI Banca (>> Unione di Banche Italiane SpA) acquiring Banca Etruria, Banca Marche and CariFerrara provided Italy's fifth-largest bank raises at least 400 million euros in fresh capital. ($1 = 0.9431 euros)

(Reporting by Valentina Za; Editing by Susan Fenton)