At the same time, additional adjustment needs should be addressed decisively to ensure a healthy euro area banking sector: tackling legacy NPLs, responding to structural change, providing regulatory clarity. These relate both to individual banks and to the institutional environment. Adjustment needs for individual banks A number of banks are now tackling their legacy and structural challenges rather than waiting for better times.
But many still need to adjust faster to the new conditions they face. The process of disposing of NPLs is moving too slowly in some jurisdictions. And cost efficiency has to adapt to the new macroeconomic and regulatory environment. As noted, euro area banks have made important progress in reducing costs since the start of the crisis.