EBA Issues Updated Risk Dashboard for Fourth Quarter of 2017
EBA published the updated version of its Risk Dashboard, summarizing the main risks and vulnerabilities in the EU banking sector for the fourth quarter of 2017. The dashboard shows significant improvements across EU banks, but elevated NPLs are still the main challenge for their profitability. Following the ESRB recommendation on commercial real estate markets, the EBA Risk Dashboard has an additional page showing the aggregated real estate exposures referred to real estate activities and the construction sector.
The progress is positive for European banks, but risks remain heightened on sustainable profitability. European banks continued to strengthen their capital ratios in the last quarter of 2017. The common equity tier 1 (CET1) ratio increased by 20 bps, from 14.6% in Q3 2017 to 14.8% in the fourth quarter of 2017, reaching a new peak since the fourth quarter of 2014. CET1 ratios are now above 11% for all institutions in the sample. The increase of capital ratios was driven by a decrease of the total risk exposures amount (mostly for credit risk). Additionally, EU banks continued to improve the overall quality of their loan portfolio. In the fourth quarter of 2017, the average ratio of non-performing loans (NPLs) to total loans continued its downward trend, reaching its lowest level since the fourth quarter of 2014 (4.0%). The widespread dispersion among EU countries (with ratios ranging from 0.7% to 44.9%), along with the still high amount of NPLs in banks' balance sheet, remains a vulnerability for the European banking sector as a whole.
The figures included in the Risk Dashboard are based on a sample of 149 banks, covering approximately 90% of the EU banking sector (by total assets), at the highest level of consolidation, while country aggregates may also include large subsidiaries.
Related Links
- Press Release
- EBA Dashboard for Q4 2017 (PDF)
- Risk Parameters Annex for Q4 2017 (PDF)
- Interactive Dashboard for Q4 2017 (XLSX)
Keywords: Europe, EU, Banking, Risk Dashboard, NPLs, CET1, EBA
Previous Article
FCA Issues PS18/8 and CP18/9 on Remedies for Asset Management MarketRelated Articles
|
News
FDIC Consults on Approach to Resolution Planning for IDIsFDIC approved an Advance Notice of Proposed Rulemaking (ANPR) and is seeking comment on ways to tailor and improve its rule requiring certain insured depository institutions (IDIs) to submit resolution plans.
April 22, 2019
WebPage
Regulatory News
|
|
News
EP Resolution on Proposal for Sovereign Bond Backed SecuritiesThe European Parliament (EP) published adopted text on the proposal for a regulation of the European Parliament and of the Council on sovereign bond-backed securities (SBBS).
April 16, 2019
WebPage
Regulatory News
|
|
News
HKMA Decides to Maintain Countercyclical Capital Buffer at 2.5%HKMA announced that, in accordance with the Banking (Capital) Rules, the countercyclical capital buffer (CCyB) ratio for Hong Kong remains at 2.5%.
April 16, 2019
WebPage
Regulatory News
|
|
News
EP Approves Agreement on Package of CRD 5, CRR 2, BRRD 2, and SRMR 2The European Parliament (EP) approved the final agreement on a package of reforms proposed by EC to strengthen the resilience and resolvability of European banks.
April 16, 2019
WebPage
Regulatory News
|
|
News
PRA Finalizes Policy on Approach to Managing Climate Change RisksPRA published the policy statement PS11/19, which contains final supervisory statement (SS3/19) on enhancing banks’ and insurers’ approaches to managing the financial risks from climate change (Appendix).
April 15, 2019
WebPage
Regulatory News
|
|
News
PRA Seeks Input and Issues Specifications for Insurance Stress TestsPRA announced that it will conduct an insurance stress test for the largest regulated life and general insurers from July to September 2019.
April 15, 2019
WebPage
Regulatory News
|
|
News
EBA Single Rulebook Q&A: First Update for April 2019EBA published answers to nine questions under the Single Rulebook question and answer (Q&A) updates for this week.
April 12, 2019
WebPage
Regulatory News
|
|
News
FED Updates Form and Supplemental Instructions for FR Y-9C ReportingFED updated the form and supplemental instructions for FR Y-9C reporting. FR Y-9C is used to collect data from domestic bank holding companies, savings and loan holding companies, U.S intermediate holding companies, and securities holding companies with total consolidated assets of USD 3 billion or more.
April 11, 2019
WebPage
Regulatory News
|
|
News
EIOPA Statement on Application of Proportionality in SCR SupervisionEIOPA published a supervisory statement on the application of proportionality principle in the supervision of the Solvency Capital Requirement (SCR) calculated in accordance with the standard formula.
April 11, 2019
WebPage
Regulatory News
|
|
News
ISDA Publishes Statement on FRTB Implementation in Emerging MarketsISDA published a statement that outlines challenges in implementation of the new Basel III market risk standard for banks in emerging markets.
April 11, 2019
WebPage
Regulatory News
|
