Featured Product

    EBA Updates Risk Dashboard for the Fourth Quarter of 2018

    March 29, 2019

    EBA published the risk dashboard for the fourth quarter of 2018. The dashboard summarizes the main risks and vulnerabilities in the EU banking sector based on data as of the end of 2018 data. In comparison with 2017, the dashboard reveals improved asset quality and stable capital ratios, though bank profitability is still below the long-term sustainable levels.

    The dashboard presents the following key results:

    • Capital ratios of European banks remained high, with a slight decrease when compared to 2017. The common equity tier 1, or CET1, (transitional) ratio was 14.6% in December 2018, showing a slight decrease from 14.9% in 2017. The decrease is driven by an increase in the total risk exposure amount. CET1 ratios remained above 11% for all countries in the sample. The fully loaded CET1 ratio also showed a decrease and stood at 14.4% compared to 14.6% in 2017.
    • The quality of loan portfolio of EU banks continued to improve. In 2018, the ratio of non-performing loans (NPLs) to total loans kept the downward trend and reached a value of 3.2%, showing its lowest level, since the NPL definition was harmonized across the EU/European Economic Area. The NPL decline is attributed both to the upward trend of total loans granted and to the steady decline in the amount of NPLs (EUR 658 billion in the fourth quarter of 2018). However, dispersion across EU/European Economic Area countries remained high and economic slowdown could make further improvements harder to achieve. The coverage ratio of NPLs and advances was 45.1% in the fourth quarter of 2018, compared to 44.6% in the fourth quarter of 2017.
    • In terms of liquidity risk, the leverage ratio remained stable and the liquidity coverage ratio continued its upward trend reaching 152%. The leverage ratio (fully phased-in) in the fourth quarter of 2018 stood at 5.3%, representing a marginal decrease from 5.4% in the fourth quarter of 2017. Furthermore, the asset encumbrance ratio remained stable compared to 2017. 


    Related Links

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

    Featured Experts
    Related Articles
    News

    EC Consults on PSD2 and Open Finance; EU Reaches Agreement on DORA

    The European Commission (EC) published a public consultation on the review of revised payment services directive (PSD2) and open finance.

    May 11, 2022 WebPage Regulatory News
    News

    EC Mandates ESAs to Propose Amendments to SFDR Technical Standards

    The European Commission (EC) has issued two letters mandating the European Supervisory Authorities (ESAs) to jointly propose amendments to the regulatory technical standards under Sustainable Finance Disclosure Regulation or SFDR.

    May 11, 2022 WebPage Regulatory News
    News

    EBA Examines Supervisory Practices, Issues Deposits Reporting Template

    The European Banking Authority (EBA) published its annual report on convergence of supervisory practices for 2021. Additionally, following a request from the European Commission (EC),

    May 11, 2022 WebPage Regulatory News
    News

    US Agency Publications Address Basel, Reporting, and CECL Developments

    The Farm Credit Administration published, in the Federal Register, the final rule on implementation of the Current Expected Credit Losses (CECL) methodology for allowances

    May 09, 2022 WebPage Regulatory News
    News

    SEC Extends Comment Period on Climate Risk Disclosures

    The U.S. Securities and Exchange Commission (SEC) looks set to intensify focus on crypto-assets and cyber risk and extended the comment period on the proposed rules to enhance and standardize climate-related disclosures for investors.

    May 09, 2022 WebPage Regulatory News
    News

    APRA Reduces Committed Liquidity Facility, Issues Other Updates

    The Australian Prudential Regulation Authority (APRA) announced reduction in the aggregate Committed Liquidity Facility and issued an update on the operational preparedness for zero and negative market interest rates.

    May 09, 2022 WebPage Regulatory News
    News

    CMF Consults on Basel Rules, Presents Roadmap to Address Climate Risks

    The Commission for the Financial Market (CMF) in Chile published capital adequacy ratios (as of February 2022, January 2022, and December 2021) for 17 banks and for the banking system.

    May 06, 2022 WebPage Regulatory News
    News

    PRA Issues Statement on NPEs and Policy on Trading Activity Wind-Down

    The Prudential Regulation Authority (PRA) issued a statement on the European Banking Authority (EBA) guidelines on management of non-performing exposures (NPEs) and forborne exposures.

    May 06, 2022 WebPage Regulatory News
    News

    EBA Updates Standards for 2023 Benchmarking of Internal Approaches

    The European Banking Authority (EBA) updated the implementing technical standards that specify the data collection for the 2023 supervisory benchmarking exercise in relation to the internal approaches used in market risk, credit risk, and IFRS 9 accounting.

    May 06, 2022 WebPage Regulatory News
    News

    EIOPA Responds to Stakeholder Views on Blockchain in Insurance

    The European Insurance and Occupational Pensions Authority (EIOPA) published a feedback statement on the responses received to the consultation on blockchain and smart contracts in insurance.

    May 06, 2022 WebPage Regulatory News
    RESULTS 1 - 10 OF 8172