In terms of Brexit, it currently seems that we no longer need to discuss if, but rather how, the UK will leave the Union. Far more interesting will be the elections in those countries which, for many observers, are regarded as core countries of European unification. We saw the outcomes of the elections in the Netherlands in March.
Rising credit risks due to deterioration in asset quality could impair the capital of banks or even render it insufficient. This could trigger a cascade of deleveraging with attendant real economy consequences.