EU banks diversified sovereign holdings in 2019
Yet banks in peripheral eurozone countries still heavily exposed to home government risk
Lenders across the European Union reduced their appetite for sovereign bonds issued by their own countries in 2019 and allocated more to the debt of overseas governments.
As of end-2019, 43.8% of sovereign bonds held by 182 EU banks were issued by their domestic governments, down from 44.9% a year prior, data from the European Banking Authority (EBA) shows. However, this is up from the 43.1% disclosed for June 2019.
Over the course of 2019, the banks increased their allocations to non-EU debt
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