Net interest margins remain highly compressed for the banks and will continue to do so while prevailing interest rates are low. Progress on profitability will only be possible in the interim due to gradual re-pricing of assets to reflect the cost of funds.
I should also note that in my view we are getting close to the position where the changing circumstances arising from successful implementation of the IMF/EU programme and the introduction of the banking union should permit the full removal of the government guarantee. This will favourably impact on profitability as a result of reduced fees.