EBF MORNING BRIEF Wednesday 5 April 2023 Good morning. Here are the top news stories and events in European banking, financial regulation and EU policy, brought to you by the European Banking Federation.
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FROM THE MEDIA Reuters: Banking crisis shows need for 'conservative' payouts As reported by Reuters, banks in the European Union must be "conservative" with dividends and other payouts after recent turmoil in the sector, and focus on keeping their cash buffers topped up, the European Union's banking watchdog affirmed. Jose Manuel Campa, chair of the European Banking Authority (EBA), said banks had strong capital and liquidity buffers, with a key measure of profitability now at a decade high. But it was unclear how rapidly rising interest rates will ultimately affect the economy and customers of banks, he added. Read more
Bloomberg: Consumers’ inflation expectations declined further
According to Bloomberg, consumer expectations for euro-area inflation fell for a second month, supporting recent remarks by European Central Bank (ECB) officials that interest-rate hikes may be nearing their end. Expectations for the next 12 months dropped to 4.6% in February from 4.9% in January, the ECB said in its monthly survey. For three years ahead, they declined to 2.4% from 2.5%. Read more S&P Global Market Intelligence: European banks' loan-to-deposit ratios held steady ahead of Credit Suisse demise Credit Suisse Group AG was the sole outlier in otherwise stable loan-to-deposit ratios at European banks as of the end of 2022. The Swiss bank's loan-to-deposit ratio jumped to 113.26% as of Dec. 31, 2022, from 74.25% a year prior, S&P Global Market Intelligence data shows. The bank suffered major deposit outflows in the fourth quarter, which continued into early 2023 and ultimately led to its forced merger with UBS Group AG. The aggregate loan-to-deposit ratio among a sample of Europe's largest banks rose to 103.16% from 101.61% over the same period. However, when removing Credit Suisse from the group, the ratio dipped marginally to 102.74% from 102.75%. Read more |
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MAIN EVENTS For a full-year overview of key financial regulation events: click here |
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SPECIAL EDITION International Banking Summit Banks in a Deglobalizing World:
Delivering for Economy and Society
1 JUNE 2023 | BRUSSELS AND ONLINE |
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FROM EBF MEMBERS BPFI: Fuelling economic and employment growth report The Banking & Payments Federation Ireland (BPFI) in conjunction with its affiliate the Federation of International Banks in Ireland (FIBI) examined the contribution of the International Banking community to the Irish economy. The new report "Fuelling economic and employment growth" shows 65% of FIBI member firms expect to increase employee numbers in 2023 with a further 80% reporting they expect activity in their Irish operations to increase in the coming year. Read more
NVB: Concerns about the financial health of healthcare institutions
Banks and accountants are concerned about the deteriorating financial health of healthcare institutions.This deterioration puts the continuity of institutions at risk and there is less room to invest in necessary transitions, such as in the field of sustainability. The Dutch Banking Association (NVB) and the accountants of healthcare providers, the Royal Dutch Association of Accountants (NBA), have written this in a letter to the Minister of Health, Welfare and Sport Ernst Kuipers and the Minister for Long-Term Care and Sport Conny Helder. Read more(NL)
FBF: Latest figures on personal loans The French Banking Federation (FBF) published the latest figures on personal loans. At the end of February, credit to individuals reached €1,513 billion, up 4.6% year-on-year, highlighting banks' support to individuals in financing projects. The French fixed-rate mortgage loan model (96% of production in February) protects borrowers against rising rates, while French households continue to benefit from more advantageous conditions for financing their real estate project (2.35% in February) compared to other countries in the euro zone (3.24% on average). Read more(FR)
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FROM THE INSTITUTIONS ECB: Anneli Tuominen, Member of the Supervisory Board of the ECB Anneli Tuominen, the European Central Bank (ECB) representative to the Supervisory Board, explained in an interview that the ECB Banking Supervision is designed to be sufficiently rigorous and demanding. Tuominen affirmed that in the euro area banks are in good shape, but it is important to stand ready to take further supervisory action if necessary.Read more
EBA: Robust EU/EEA banking sector shows strong capital and liquidity ratios
The European Banking Authority (EBA) published its quarterly Risk Dashboard (RDB) together with the first edition of the RDB on minimum requirement for own funds and eligible liabilities (MREL). Volatility in EU/EEA banks’ equity and debt has been strongly affected by Silicon Valley Bank (SVB) and Credit Suisse related events, although direct exposures of EU/EEA banks towards these banks were limited according to indications from supervisory reporting as of Q4 2022. Banks’ capital and liquidity ratios remain strong and profitability continues to increase. Read more BIS: Macroprudential policies for addressing climate-related financial risks The Bank for International Settlements (BIS) in its latest publication discussed macroprudential policies and their role in maintaining financial stability by increasing the resilience of the financial system and containing the accumulation of systemic risks. Failure to adjust the scope of application of macroprudential policies for addressing climate risks may make them ineffective or even counterproductive for financial stability. For this reasons, authorities need to carefully define the scope of application of such macroprudential policies. Read more |
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FROM THE EBF EBF: Views on Open Finance: towards a fit-for-market approach To meet real customer needs, boost innovation, and ensure a level playing field, the upcoming Open Finance proposal of the Commission should adopt a market-led approach. The latest EBF Paper calls for voluntary data sharing, supported by a flexible framework of key principles for all market participants, including incentives for data sharing and strong security and consumer protection provisions, including on liability. Read more EBF: European banking industry sets out a vision for digital euro The European Banking Federation (EBF) has published a vision paper on a Digital Euro Ecosystem. It argues that a retail digital euro could be envisaged in the mix of new tools and solutions to meet evolving payment needs, as long as it adds value to consumers, is appropriately designed, in close cooperation with the private sector, and mitigates ex ante the accompanying risks. Read more
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ABOUT THE EUROPEAN BANKING FEDERATION
The European Banking Federation is the voice of the European banking sector, bringing together national banking associations from across Europe. The federation is committed to a thriving European economy that is underpinned by a stable, secure and inclusive financial ecosystem, and to a flourishing society where financing is available to fund the dreams of citizens, businesses and innovators everywhere. Website: www.ebf.eu |
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