EBA Updates Risk Dashboard for the Third Quarter of 2018

The dashboard reveals that the capital ratios of European banks remained high, with a modest increase since the second quarter of 2018. The common equity tier 1 (CET 1) ratio on a transitional basis increased from 14.5% in the last quarter to 14.7% in the third quarter of 2018 as the result of both an increase in CET 1 capital and a decrease in total risk exposures. Banks representing 99.6% of total assets have a CET 1 ratio above 11%. The quality of the loan portfolio of banks in EU has improved further. In the third quarter of 2018, the ratio of non-performing loans (NPLs) to total loans kept the downward trend and stood at 3.4%, its lowest level since the NPL definition was harmonized across European countries in 2014. Profitability in the EU banking sector needs to improve further while the loan-to-deposit ratio has remained broadly stable. Moreover, the leverage ratio (fully phased-in) remained stable at 5.1% and the liquidity coverage ratio improved to 148.5% in the third quarter of 2018, the highest value since the third quarter fo 2016 and well above the 100% requirement.

Related Links

• Press Release
• Risk Dashboard Data (PDF)
• Risk Dashboard Interactive Tool (XLSX)
• Summary of Questionnaire Results (PDF)

Keywords: Europe, EU, Banking, Risk Dashboard, NPLs, CET 1, Liquidity Risk, EBA