For example, Common Equity Tier 1 ratios in the euro area have improved substantially, rising from less than 7% for significant banking groups in 2008 to more than 14% today. The welcome improvements in bank solvency – and the related improvement in asset quality – are a tangible result of our common work to create the Banking Union.
The comprehensive assessment we conducted in 2014 – together with a deep asset quality review – encouraged banks to strengthen their balance sheets without delay. As a result, while the level of non-performing loans (NPLs) remains high in some countries, today this problem is not primarily related to the robustness of balance sheets.