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E U R O P E A N B A N K I N G A U T H O R I T Y

8

Introduction

This is the seventh semi‑annual report on

risks and vulnerabilities of the European

banking sector published by the EBA. This

report describes the main developments

and trends that have affected the EU banking

sector since mid-2014 and provides the EBA’s

outlook on the main micro‑prudential risks

and vulnerabilities looking ahead (

1

). This re-

port is based on qualitative and quantitative

information collected by the EBA. This report

is based on five main exclusive data sources,

namely:

(a) EBA key risk indicators (KRI);

(b) EBA Supervisory Reporting;

(c) the EBA RAQ for banks;

(d) the EBA RAQ for market analysts; and

(e) micro‑prudential expertise and college

information‑gathering.

The EBA KRI are a set of 53 indicators col-

lected on a quarterly basis by national su-

pervisors, from a sample of 55 European

banks in 20 European economic area (EEA)

countries from 2009 onwards. The banks in

the sample cover at least 50 % of the total

assets of each national banking sector. The

reference date for the data is 31 December

2014. Information about the sample and de-

scriptive statistics of the latest KRI can be

found in the annex. The weighted average ra-

tios are described unless stated otherwise.

In the country‑by‑country comparison and

respective statistics the name of a country is

only given if there are three or more report-

ing banks from this country. Since KRI are

collected at a point in time, they tend to be

backward‑looking in nature. They are thus

complemented with various forward‑looking

sources of information and data, such as

semi‑annual and ad hoc surveys.

The harmonised supervisory reporting

framework based on the EBA implement-

ing technical standard (ITS) on supervisory

(

1

) With this report, the EBA discharges its responsibil-

ity to monitor and assess market developments and pro-

vides information to other EU institutions and the general

public, pursuant to Regulation (EU) No 1093/2010 of the

European Parliament and of the Council of 24 November

2010 establishing a European Supervisory Authority (Euro-

pean Banking Authority), and amended by Regulation (EU)

No 1022/2013 of the European Parliament and of the Coun-

cil of 22 October 2013.

reporting came into force during 2014 (

2

).

The EBA started collecting harmonised su-

pervisory data based on the ITS from 192

banks from 29 EEA countries (

3

).The sample

of banks covers at least three banks from

each country and in addition all large banks.

Due to the lack of historical information, the

new data and enlarged sample have been

used in this report only in specific sections

on non‑performing and forborne loans and

on asset encumbrance. Similarly to KRIs,

country averages are shown when at least

three banks have reported data. Due to the

varying scope of the ITS requirements this

may vary especially for financial information

for which there are not always three banks

reporting in the sample. The cut‑off date for

KRIs and extended Supervisory Reporting is

30 April 2015.

The RAQ is a semi‑annual survey conducted

by the EBA, asking banks and/or their finan-

cial supervisors a number of multiple‑choice

questions. Information from the question-

naire completed in March 2015 and compari-

sons with previous responses from a rep-

resentative sample of 39 European banks

(Annex I) are used in this report. In addition,

the EBA conducted a survey (RAQ for mar-

ket analysts) asking market analysts (29 re-

spondents) a number of questions in a multi-

ple‑choice format with responses reflecting

the degree of agreement with a given state-

ment.

The report also analyses information gath-

ered by the EBA from the European colleges

of supervisors and from informal discussions

as part of the regular risk assessments and

ongoing dialogue on risks and vulnerabilities

of the EU banking sector. The report is or-

ganised as follows.

Chapter 1 looks at the external environment

and processes by which EU banks’ assets

and liabilities are developing in a given mar-

ket sentiment and macroeconomic environ-

ment, taking into account the regulatory de-

velopments and structural and institutional

reforms at EU level. Chapter 2 focuses on the

asset side, explaining the ongoing de‑risking

(

2

)

http://www.eba.europa.eu/regulation‑and‑policy/ supervisory‑reporting,

http://eur‑lex.europa.eu/legal‑con- tent/EN/TXT/?uri=OJ:JOL_2014_191_R_0001

.

(

3

)

http://www.eba.europa.eu/risk‑analysis‑and‑data;jsess ionid=32D6610C3D1FB0CC13ECA43D0B13A20F

.