Italy's banking sector is in trouble. The government is mulling a €20 billion ($20.8 billion) bailout package. James Hughes, chief market strategist at GKFX, based in London, said the main issue stems from Banca Monte dei Paschi di Siena (BMDPY) , which needs €5 billion by the end of the year just to stay afloat. He also said the political uncertainty sparked by the resignation of Prime Minister Matteo Renzi after losing the Dec. 4 constitutional reform referendum is bleeding into the banking sector, fanning fears that consumers will withdraw their deposits from the banks. TheStreet's Scott Gamm reports from Wall Street.