MILAN (Reuters) - The European Central Bank sees no risk of a banking crisis in the euro zone despite some “individual cases” of lenders in trouble, senior ECB supervisor Ignazio Angeloni said on Wednesday.
Banking shares have sold off this year amid investor worry about the impact of low interest rates on their profits, high piles of bad loans in some countries and a multi-billion-dollar fine facing Germany’s Deutsche Bank (DBKGn.DE).
Angeloni, a senior member of the ECB’s arm in charge of supervising the euro zone’s 129 largest banks, said the system was solid.
“There are individual cases of banks with problems, but the system is solid,” he told an event in Milan. “There are supervisory and financial tools to deal with specific situations. We don’t see the preconditions for a systemic crisis.”
The ECB is trying to get banks to manage down a 900 billion euro pile (£0.79 trillion) of soured credit left over from the financial crisis.
This will include asking banks to set numerical targets for the levels of non-performing loans they aim to reach in one and three years, according to ECB guidelines published last month.
Angeloni acknowledged this process would take time but said it needed to start immediately. “We must be aware that the solution, even for banks where the problem is more acute, can’t be very fast. But precisely because it is a long process, it should start right away.”
Writing by Francesco Canepa in Frankfurt; Editing by Mark Heinrich