The median core Tier 1 ratio of the euro area large and complex banking groups reached 11.1% in the first quarter of 2013, up from 9.6% at the end of 2011.8 Furthermore, the results of the ECB’s Euro area bank lending survey, showing that euro area banks started tightening credit standards as early as the third quarter of 2007, may also be interpreted as going against the hypothesis of excessive risk taking.
Also, the evidence of the deleveraging of non-financial corporations during the financial crisis points against the hypothesis of the evergreening of loans. However, the observed large exposure of banks to sovereign debt may have longer-term effects on the non-financial sector of the economy.