NPL in the EU are declining (but Watch out for GACS)

According to the latest press release, efforts to reduce risks in the EU banking sector are bearing fruit, as in its fourth progress report on the reduction of non-performing loans (NPLs), the Commission confirms that NPL levels are continuing their downward trajectory towards pre-crisis levels.

The ratio of NPLs in EU banks has come down by more than half since 2014, declining to 3.3% in the third quarter of 2018 and down by 1.1 percentage points year-on-year.

Valdis Dombrovskis, Vice-President responsible for Financial Stability, Financial Services and Capital Markets Unionsaid: “Working out the remaining stocks of non-performing loans is part of our ongoing efforts to make the banking sector even stronger. Our banks are now better capitalised and better prepared to withstand economic shocks. We’ve recently agreed on more robust framework to regulate and supervise banks. Given this progress in reducing risks, I call on EU Finance Ministers to move forward with other measures to complete the Banking Union.”

As I happend to discuss at the recent Global ABS 2019 a substantial part of NPL transactions have been disposed using securitization schemes and expecially for the Italian ones involving GACS senior tranches are still on banks’ balance sheets.

This may mean that even though the general picture can look positive, some critical issues are still pending as I pointed out in this article in italian.

Do you like these updates? subscribe my newsletter 

Are you interested in Italian banks and NPL/UTP market? Ask for a briefing  (in person or via conference call) by sending me a private message. I am also available for consulting projects on Distressed Assets pricing and Portfolio Management.

Link to my updated business profile

To get further updates Join the Linkedin Group – Entering Italian NPL Market  and follow #Liberi Di Scegliere via @blastingnews

@massimofamularo

Linkedin

GLG – Gerson Lehrman Group – Council Member

Advertisement