Slide 9 illustrates average loan and deposit rates for both non-financial corporations and households in the euro area.25 [Slide 9: Euro-area banks: Interest rates on new loans and deposits] The vertical red line indicates June 2014, the first time deposit facility rates became negative in the euro area.
Smaller banks may also find that they are able to win good, solid business away from their national competitors, if customers turn away from large banks as a consequence of the crisis. But community banks cannot count on this happening. As a result, some banks may reach further out on the risk spectrum to relieve earnings pressures.