European banks are set to face credit losses of as much as 800 billion euros ($947 billion) in the next three years in a worst-case scenario, according to an Oliver Wyman report.
In case the region is not hit by a second COVID-19 wave, a sharp rise in unsecured loan losses might still cost banks in Europe about 400 billion euros ($473 billion), the report said.
“The pandemic is unlikely to cripple the European banking sector, however many banks will be pushed into a ‘limbo state’, with very weak returns,” said Oliver Wyman’s co-head of EMEA financial services.
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The effects of COVID-19 are yet to fully unravel for the European banking landscape.
The pandemic’s impact is here to stay and will have far-reaching repercussions for European banks, according to a recent report by consultancy firm Oliver Wyman.
Banks in Europe can expect to face credit losses — bad loans that are unlikely to be recovered — of as much as 800 billion euros ($947 billion) in an adverse case scenario, the report said.
Despite the huge figure, the report said these credit losses are “manageable” as the amount would be less than 40% of those experienced …read more
Source:: Businessinsider – Finance