The advent of spring brings with it the hope of rebirth, renewal and regeneration. While the modest improvement in financial results, economic performance and market sentiment doesn’t herald the changing of a season, it could suggest that the dark days of the financial crisis are beginning to fade.
Banks haven’t returned to pre-crisis growth or profitability levels but have made significant strides to replenish their balance sheets. All of the largest EU banks exceed the minimum capital requirement of Basel III (4.5% CET1), while they are less than €3 billion short of reaching the 7.0% level of 4.5% plus 2.5% capital conservation buffer. The shortfall figure remains the same when the surcharge for G-SIBs is considered.