Given that lending to the household sector, has, for several years, been the most rapidly growing line of business for banks, the continuing growth of exposures to the household sector is a potential source of increasing credit risk. However, the quality of credit granted to households tends to be generally higher than that extended to the corporate sector.
Supervisors and their toolbox But European banking supervisors need more than an adequate rulebook to do their job. They also need the right tools, of course. They need a European toolbox. And here, a lot has been done. We have harmonised the main tool of banking supervision: the supervisory review and evaluation process, SREP for short.