European banks need, on average, to increase their minimum capital by 24.4% with the new requirements set by the Basel III standard, which currently represents a deficit of 135,100 million euros, the European Banking Authority (EBA) confirmed.
J. L. M. Campuzano (Spanish Banking Association) |So where do we go now? Do we stop extending banking regulation or do we keep including more conditions? We look to the US, but actually the debate already started a few months ago in Europe. Many experts (some from the ECB itself) warned about the complexity of the measures taken up to now and about the risk this implied for the sector’s stability. And for the financing of the economy.
Banks have made a massive effort to increase their solvency by sharply reducing risk exposure and boosting their own resources. They face rough times ahead as plummeting interest rates and profits leave them little room for comfort. Some big players, such as Deutsche Bank, have suffered huge losses while others struggle to keep pace faced with an adverse outlook.
The EBA published yesterday the results of its regular health checks on banking, focused on the capital, leverage, liquidity and net stable ratios at the close of 2014. On average results fall comfortably inside the stringent Basel III requirements.
July 1, 2015 | BNP | While Grexit is the market concern of the moment, disintermediation and securitisation will be important to monitor for the future.
MADRID | May 13, 2015 | By Ana Fuentes | Professor at the Adam Smith Business School at Glasgow University, John Holland says financial institutions have become too complex for the general public and there is a crisis of confidence in banking and financial capitalism. He insists Basel III is not sufficient to regulate the banks and supports proposals to split up the different banking activities. This is the first part of our conversation.
MADRID | May 9, 2015 | By Fernando G. Urbaneja | Spanish banks are still the central pillar of the Spanish stock market: seven lenders account for nearly 40 percent of the IBEX-35 index.
MADRID | May 5, 2015 | By JP Marín Arrese | Banks have undergone a massive overhaul to meet demanding requirements under Basel III. They have substantially strengthened their core capital over the last couple of years to keep abreast of increasing requests tabled by regulatory bodies. The leverage ratio under implementation represents a new challenge which is likely to have a significant influence on their business strategy.
BBVA Reasearch | March 31, 2015 | The EBA (at European level) and the BCBS (at global level) both published their 7th Basel III Monitoring Report on March 3rd, using data as of June 2014. Overall, the trend towards enhancing the resilience of banks’ balance sheets is underpinned. Indeed, there has been an improvement in all the three pillars of the new prudential framework: capital, leverage and liquidity. The EBA estimates a capital shortfall of EUR2.8bn for a 7% CET1 of Group 1 banks, which means a decrease of 75% compared with the previous publication.
MADRID | The Corner | Financial entities need to submit allegations on the European Central Bank’s solvency ratios recommendations next week. As expected, due to their systemic nature the ECB is asking the biggest lenders (Santander and BBVA) a 9.0% ratio versus the 8.0% required for their smaller peers such as Caixabank, Bankia and Sabadell.