Categories
Economy ENG Eurozone

Market focus: European Banks from resilience to consolidation

– Most European Banks are resilient to the economic fallout from the Coronavirus crisis as they enter into the crisis with significantly improved solvency indicators, compared to a decade ago.
– However, this resilience masks structural weaknesses which translate into lower performance and market valuations amid persistent banking fragmentation alongside national markets within Europe
– The Banking sector in Europe seems ripe for another wave of consolidation. The big question is whether regulators are also ready for that. The ECB seems to welcome this process but the challenge comes from other market regulators.

- Most European Banks are resilient to the economic fallout from the Coronavirus crisis as they enter into the crisis with significantly improved solvency indicators, compared to a decade ago.
- However, this resilience masks structural weaknesses which translate into lower performance and market valuations amid persistent banking fragmentation alongside national markets within Europe
- The Banking sector in Europe seems ripe for another wave of consolidation. The big question is whether regulators are also ready for that. The ECB seems to welcome this process but the challenge comes from other market regulators . . .

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