The European Banking Authority (EBA) published today the periodical update to its Risk Dashboard, which summarises the main risks and vulnerabilities in the EU banking sector using quantitative risk indicators, along with the opinions of banks and market analysts from its Risk Assessment Questionnaire. In the first quarter of 2018, the updated dashboard identified ongoing improvements in the repair of the EU banking sector but also residual risks in banks’ profitability.

European banks’ capital ratios remained high, albeit with a slight decrease in the first quarter of 2018. The CET1 ratio experienced a decrease of 50 bps, from 14.9% to 14.4% in Q1 2018, mainly driven by a decrease in CET1 capital (“retained earnings”), also linked to the adoption of the new accounting framework (IFRS9). Compared to the previous quarter, the fully loaded CET1 ratio decreased by 40 bps to 14.2% and the total capital ratio by 40 bps to 18.7%.

EU banks continued to improve the overall quality of their loans’ portfolio. In Q1 2018, the average ratio of non-performing loans (NPL) continued its downward trend, reaching its lowest level since Q4 2014 (3.9%). This result is jointly explained by an increase in the outstanding volume of loans granted and a decrease of NPLs by almost 1/3 in 3 years, from over EUR 1.12 trillion to EUR 779.2 billion. Despite the progress, additional efforts are still needed to reduce the volume of legacy assets.

Profitability remains a concern for the EU banking sector. On a year-on-year comparison, the average ROE decreased by 50 bps to 6.8% in Q1 2018, mainly driven by the annual decrease in net trading income (4.5 p.p. to 5.6% in Q1 2018). The low profitability and widespread dispersion for some countries (with the ROE ranging from 0.7% to 19.1%), along with high operating costs, continues to dampen the profitability prospects for the European banking sector as a whole. However, the results of the EBA Risk Assessment Questionnaire show that banks, as well as market analysts, expect a slight improvement in profitability of banks in the near future. This is expected to be driven partly by increasing fees and commission income and decreasing operating expenses.

The loan-to-deposit ratio remained broadly stable, reaching 118.5% with an increase of 100 bps from the previous quarter. The leverage ratio (fully phased-in) decreased by 30 bps from 5.4% (Q4 2017) to 5.1% (Q1 2018), reflecting the impact of the new accounting framework (IFRS 9). In March, the average liquidity coverage ratio (LCR) was 147.0%, well above the threshold defined as the liquidity coverage requirement for 2018 (100%). Regarding the future of EU banks’ funding, the results of the EBA Risk Assessment Questionnaire suggest that going forward, banks expect to target mainly retail deposits and attain more instruments eligible for MREL, even though they consider the uncertainty on the specific MREL requirements as a constraint to their issuance.

The results of the Risk Assessment Questionnaire also show that cyber risk and data security are considered as the main drivers for the increase in operational risk. They are also assumed to be the main factors that might negatively influence market sentiment, along with geopolitical uncertainties including the UK’s decision to leave the EU.

Notes to editors
The figures included in the Risk Dashboard are based on a sample of 152 banks, covering more than 80% of the EU banking sector (by total assets), at the highest level of consolidation, while country aggregates may also include large subsidiaries (the list of banks can be found here https://www.eba.europa.eu/risk-analysis-and-data). The Q1 2018 EBA Risk Dashboard includes, for the first time, the figures for Icelandic banks.

IFRS 9, which entered into force on 1 January 2018, may have had an impact on some of the ratios included in the dashboard.

Scarica il Risk Dashboard EBA

Remarks by Mr John C Williams, President and Chief Executive Officer of the Federal Reserve Bank of New York, at the Governance and Culture Reform Conference, Federal Reserve Bank of New York, New York City,
18 June 2018.

Central bank speech | 18 July 2018 by John C Williams
PDF version (34kb) | 3 pages

Il 4 luglio scorso la BCE ha pubblicato il documento “SSM LSI SREP Methodology”, con l’obiettivo di illustrare le principali caratteristiche della metodologia, sviluppata congiuntamente alle Autorità Competenti Nazionali nell’ambito del Meccanismo Unico di Vigilanza (MVU), per lo svolgimento del processo di revisione e valutazione prudenziale (SREP) delle banche meno significative (Less Significant Institutions – LSI). Il “booklet” è ora disponibile anche sul sito della Banca d’Italia.

La Banca d’Italia ha ampiamente contribuito all’elaborazione della metodologia, mutuata da quella già in uso per le banche “significative” nel rispetto del principio di proporzionalità. Sono previsti margini di flessibilità per consentire alle Autorità nazionali, che conducono lo SREP in quanto responsabili della supervisione sulle LSI, di considerare le caratteristiche specifiche delle singole giurisdizioni. L’obiettivo è di favorire una crescente armonizzazione dei metodi di analisi e delle prassi di supervisione all’interno del MVU, pur tenendo debitamente conto dei differenti contesti.

La metodologia SREP armonizzata verrà applicata alle banche meno significative in modo graduale entro il 2020. La Banca d’Italia ha deciso di utilizzarla quest’anno per le sole LSI di maggiore complessità e rischiosità (classe di priorità alta – High Priority). Verranno fornite successive comunicazioni sulle modalità con cui l’applicazione della metodologia verrà estesa a tutte le LSI.
Resta fermo che per gli aspetti non specificati nel “booklet”, quali le modalità con cui si esplica l’azione di vigilanza nella determinazione delle misure patrimoniali e degli interventi correttivi, continueranno a essere applicate le disposizioni contenute nella Guida per l’attività di vigilanza (Circolare 269, pubblicata sul sito della Banca d’Italia) anche per la banche classificate a priorità alta.

In consultazione lo schema delle Istruzioni con le quali la UIF intende disciplinare la materia delle comunicazioni oggettive dando prima attuazione all’art. 47 del decreto legislativo 21 novembre 2007, n. 231, come modificato dal decreto legislativo 25 maggio 2017, n. 90, di att inuazione della direttiva 2015/849/UE (IV Direttiva Antiriciclaggio).
Il comma 1 dell’articolo 47 prevede in particolare l’obbligo di trasmettere alla UIF, con cadenza periodica, dati e informazioni selezionati in base a criteri oggettivi, concernenti operazioni a rischio di riciclaggio o di finanziamento del terrorismo. Viene in tal modo introdotta nell’ordinamento italiano una fonte informativa prevista dagli standard del GAFI e dalle regole europee e già adottata in diversi altri Paesi a beneficio delle Financial Intelligence Unit.
La consultazione rimarrà aperta fino al prossimo 30 di agosto.

Documento per la consultazione UIF – Luglio 2018