Risk Quantum/European Central Bank (ECB)
EU stress tests not as tough as financial crisis
Projected GDP decline for Spain, Ireland and Italy milder than during the credit crunch
Derivatives assets surge at eurozone hedge funds
Derivatives assets made up 16% of total hedge fund assets in March
Restructured Deutsche would be slimmest eurozone G-Sib
As of Q4 2018, the German bank was the third-largest systemic lender by leverage exposure
Some EU funds leveraged more than 500% using CDS
1,337 funds held €387 billion of CDS notionals at end-2016
Giant EU banks grow asset share over four years
Share of assets held by five largest banks in the median EU member state hits 65%
Bond binge accelerates at eurozone insurers
Annualised growth rate of debt portfolios hits new high of 2.6%
Eurozone insurers’ bets on alternatives raises systemic risk
Dutch firms have more than 25% of total assets tied up in non-traditional investments
Eurozone systemic risk diminishes
Yet jumbo exposures to other banks dominate intra-system assets
Eurozone securitisation engine sputters in Q1
Holdings of eurozone bank loans by SPEs are contracting
Single Resolution Fund fees jump at most large EU banks
Contributions fall for Deutsche Bank and Societe Generale
EU’s model study finds problems with bank VAR methods
Banks surveyed by the ECB had an average of 32 issues with their market risk models
Easing of euro OTC trade terms anticipated – ECB
Financial strength of counterparties and competitive pressures could cause easing