EBA Releases Spring 2020 Transparency Exercise Data on Banks in EU
EBA published bank-by-bank data from the seventh transparency exercise in EU. This additional data disclosure comes as a response to the outbreak of COVID-19 and provides market participants with bank-level data as of December 31, 2019, prior to the start of the crisis. Along with the data set, EBA also provided a document highlighting the key statistics derived from the data set and a wide range of interactive tools that allow users to compare and visualize data by using maps at a country and a bank-by-bank level. The data confirm that the banking sector in EU entered the crisis with solid capital positions and improved asset quality, but also shows the significant dispersion across banks.
In the context of an unprecedented health crisis, EU-wide transparency data confirms banks entered this challenging period in a stronger position than in previous crises. Compared with the Global Financial Crisis in 2008-2009, banks now hold larger capital and liquidity buffers. EU banks reported increasing capital ratios in 2019. The EU weighted-average common equity tier 1 (CET1) fully loaded capital ratio was at 14.8% as of the fourth quarter of 2019, nearly 40 bps higher than in the third quarter of 2019. The trend was supported by higher capital, but also contracting risk exposure amounts. As of December 2019, 75% of the banks reported a CET1 fully loaded capital ratio above 13.4% and all banks reported a ratio above 11%, well above the regulatory requirements.
The EU weighted fully phased-in leverage ratio stood at 5.5% as of December 2019. The leverage ratio increased by 30 bps compared to the previous quarter, driven by rising capital and declining exposures. The lowest reported leverage ratio was 4.7% at country level and 1.6% at bank level. The asset quality of EU banks has been on an improving trend over the last few years. As of the fourth quarter of 2019, the EU weighted average nonperforming loan ratio declined to 2.7%, 20 bps lower than in the third quarter of 2019. The ratio in the fourth quarter of 2019 was the lowest since the EBA introduced a harmonized definition of nonperforming loans across European countries. Dispersion in the nonperforming loan ratio across countries remained wide, with few banks still reporting double-digit ratios, although in the last quarter the inter-quartile range compressed by 80 bps, to 3.1%.
Earlier, EBA had postponed the EU-wide stress test exercise to 2021 to allow banks to focus on and ensure continuity of their core operations, including support for their customers. The Spring 2020 EU-wide transparency exercise comes as an exceptional disclosure in response to the outbreak of COVID-19. After postponing the EU-wide Stress Test to 2021, the Board of Supervisors agreed on an additional EU-wide transparency exercise to be carried out with the aim of providing updated information on bank exposures and asset quality to market participants. The transparency exercise is part of the ongoing efforts of EBA to foster transparency and market discipline in the EU financial market and complements banks’ own Pillar 3 disclosures, as laid down in the EU Capital Requirements Directive. Unlike stress tests, transparency exercises are purely disclosure exercises where only bank-by-bank data are published and no shocks are applied to the actual data. The Spring 2020 transparency exercise covers 127 banks from 27 European economic area countries and data is disclosed at the highest level of consolidation as of September 2019 and December 2019. The transparency exercise fully relies on supervisory reporting data.
Related Links
Keywords: Europe, EU, Banking, COVID-19, Spring 2020 Transparency Exercise, Transparency, Basel, Reporting, EBA
Featured Experts

María Cañamero
Skilled market researcher; growth strategist; successful go-to-market campaign developer

Nicolas Degruson
Works with financial institutions, regulatory experts, business analysts, product managers, and software engineers to drive regulatory solutions across the globe.

Patrycja Oleksza
Applies proficiency and knowledge to regulatory capital and reporting analysis and coordinates business and product strategies in the banking technology area
Previous Article
PRA Updates Lists of Regulated Banks and Ring-Fenced Bodies in UKRelated Articles
EBA Launches Stress Tests for Banks, Issues Other Updates
The European Banking Authority (EBA) launched the 2023 European Union (EU)-wide stress test, published annual reports on minimum requirement for own funds and eligible liabilities (MREL) and high earners with data as of December 2021.
EBA Proposes Standards for IRRBB Reporting Under Basel Framework
The European Banking Authority (EBA) proposed implementing technical standards on the interest rate risk in the banking book (IRRBB) reporting requirements, with the comment period ending on May 02, 2023.
FED Issues Further Details on Pilot Climate Scenario Analysis Exercise
The U.S. Federal Reserve Board (FED) set out details of the pilot climate scenario analysis exercise to be conducted among the six largest U.S. bank holding companies.
US Agencies Issue Several Regulatory and Reporting Updates
The Board of Governors of the Federal Reserve System (FED) adopted the final rule on Adjustable Interest Rate (LIBOR) Act.
ECB Issues Multiple Reports and Regulatory Updates for Banks
The European Central Bank (ECB) published an updated list of supervised entities, a report on the supervision of less significant institutions (LSIs), a statement on macro-prudential policy.
HKMA Keeps List of D-SIBs Unchanged, Makes Other Announcements
The Hong Kong Monetary Authority (HKMA) published a circular on the prudential treatment of crypto-asset exposures, an update on the status of transition to new interest rate benchmarks.
EU Issues FAQs on Taxonomy Regulation, Rules Under CRD, FICOD and SFDR
The European Commission (EC) adopted the standards addressing supervisory reporting of risk concentrations and intra-group transactions, benchmarking of internal approaches, and authorization of credit institutions.
CBIRC Revises Measures on Corporate Governance Supervision
The China Banking and Insurance Regulatory Commission (CBIRC) issued rules to manage the risk of off-balance sheet business of commercial banks and rules on corporate governance of financial institutions.
HKMA Publications Address Sustainability Issues in Financial Sector
The Hong Kong Monetary Authority (HKMA) made announcements to address sustainability issues in the financial sector.
EBA Updates Address Basel and NPL Requirements for Banks
The European Banking Authority (EBA) published regulatory standards on identification of a group of connected clients (GCC) as well as updated the lists of identified financial conglomerates.