EU/EEA banks display strength amid a challenging risk environment
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The EBA Risk Dashboard for Q2 2026 shows a solid EU/EEA banking sector in a very uncertain environment: ample capital and liquidity, growing lending with sound asset quality and high profitability. The EBA calls for monitoring geopolitical tensions and high valuations linked to AI financing.
Key points
- CET1 of 16.1% (16.2% the previous quarter), LCR of 158.5% and NSFR of 125.7%.
- Household loans +5.2% and corporate loans +6.3% year on year; NPL ratio of 1.8% and Stage 2 loans at 8.9%.
- ROE of 11.3% (10.7% a year earlier) and cost-to-income ratio of 51.5%.
- Direct exposure to the IT sector is only 4% of corporate lending, with no deterioration.
Who is affected
EU/EEA banks, investors in the sector and supervisors.
Plain-language version
The quarterly check-up by the EBA, the EU authority that sets the rules for banks, says EU banks are strong: a 16.1% capital cushion, only 1.8% of loans unpaid and 11.3% profitability. Lending to households is up 5.2% and to companies 6.3%. Still, it urges caution over geopolitical tensions and very high prices linked to AI investment.
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