The objective of this session is to discuss the short- and medium-term banking challenges related to the four priority areas assessed by the ECB Banking Supervision and that have been materially affected by the current crisis: credit risk management, capital strength, business model sustainability (profitability issues) and governance (credit risk management, risk data aggregation and reporting adequacy). Then, the panel will focus on the appropriate policy measures to address these challenges.
Speakers will be invited to express their views notably on the EU regulatory and supervisory approaches to address the evolution of non-performing loans (NPLs) over time as well as the general weakening of corporate counterparts and the exit strategy and tools to consolidate the support provided by existing regulatory and supervisory support measures.
While panellist may touch on issues related to bank profitability or digitalisation challenges, the specific proposals associated with these areas will be addressed in another session of the Lisbon event.
Points of discussion
- What are the main short- and medium-term challenges faced by the EU banking system given the Covid -19 pandemic (deterioration in asset quality, impacts on profitability, business model sustainability, capital strength, an increasing bank sovereign loop …) and what are the main discrepancies across EU member states in this respect?
- How to address the situation? What are the existing tools available? Do they need to be completed? When and how to unwind COVID support measures to the banking system?