“The risks in the financial system are still high”

Jose Manuel Campa

The EBA boss is “relatively satisfied” with the state of the European banking sector.

(Photo: imago images/IP3press)

Frankfurt After the bankruptcy of the Silicon Valley Bank and the emergency merger of Credit Suisse and UBS, the European banking authority EBA expects turbulent times to continue. “The risks in the financial system are still very high,” EBA boss José Manuel Campa told Handelsblatt. In addition, rising interest rates weighed on the financial markets. “Such a drastic turnaround in interest rates not only increases the earnings opportunities for banks, but also the risks.”

The EBA is keeping a close eye on unrealized losses on bank balance sheets, Campa said. In the fall, she already carried out an impact study on interest rate risks in European banks, which is currently being updated. “The investigation has not yet been completed, but I can already say today: we do not expect to find significant institutions where there are significant solvency risks due to unrealized losses.”

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