那提西银行-欧洲-银行业-欧元区的银行是否完全恢复？-20180525-6页_664kb

Flash Economics Summary: Are Banks in the Euro Zone Fully Restored?

Core Content

This document analyzes the current state of euro-zone banks, focusing on their balance sheet structure, non-performing loans (NPLs), and profitability, to assess whether they have fully recovered from the financial crisis. It also examines the financial markets' perception of the banks' health through share prices, bond spreads, and credit default swaps (CDS).

Main Points

1. Financial Markets' Perception

• Financial markets do not believe that euro-zone banks are fully restored.
• High risk premia are still demanded from banks, as shown by:
  • Share prices (Chart 1)
  • Bond spreads (Chart 2)
  • CDS rates (Chart 3)

2. Balance Sheet Structure

• Banks have seen a sharp increase in capital.
• The weight of risky assets has declined.
• There has been an increase in liquidity reserves, including:
  • Outstanding government bonds (Chart 4C)
  • Total outstanding bonds (Chart 4D)
  • Reserves at the ECB (Chart 4E)

3. Non-Performing Loans (NPLs)

• The level of NPLs has been declining since 2014, but remains abnormally high.
• Unprovisioned NPLs are still a concern, as shown in:
  • Performing loans (Chart 5A)
  • Unprovisioned NPLs-to-capital ratio (Chart 5B)

4. Interest Rate Margins and Profitability

• Interest rate margins on loans have increased compared to pre-crisis levels, especially for household loans.
• Business loans show similar margins to pre-crisis levels.
• Despite these improvements, profitability and return on equity (RoE) remain weakened.

Key Findings

• Balance sheet structure has improved significantly.
• Non-performing loans are still at high levels, indicating ongoing credit risk.
• Profitability remains weak, even with improved interest rate margins.
• Financial markets remain cautious, suggesting that the banking sector is not yet fully restored.

Conclusion

Given the continued high levels of NPLs and weak profitability, it is understandable that financial markets still exhibit aversion to banking risk in the euro zone. While balance sheet improvements are evident, the sector has not yet regained its pre-crisis strength and stability.

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