Europe’s bad bank loans at €1- trillion
EUROPEAN banks’ bad loans have more than doubled since 2009 to stand at about ß1- trillion (R15.8-trillion) at the end of last year, an International Monetary Fund paper said yesterday.
High levels of non-performing loans (NPLs) to companies, particularly small and medium-sized firms, were dampening credit supply and tying up bank capital that could otherwise be used to increase lending.
“Given the urgent need to support Europe’s still tentative recovery, resolving NPLs expeditiously to promote new lending is of first-order macroeconomic importance,” IMF staff said in a discussion note.
NPLs were particularly high in the southern part of the euro area, where corporate debt had reached acute levels, and in eastern and southeastern Europe. – Reuters