In a new day with strong falls in the prices of the shares of banking entities, The president of the European Central Bank (ECB) and leaders of several countries of the European Union (EU) expressed this Friday their confidence in the sector of the bloc, in an attempt to calm the markets.
Bank shares fell sharply in Europe on Friday, especially those of the heavyweights Deutsche Bank and UBS Groupwho were driven by the fear that the worst problems in the sector since the financial crisis of 2008 have not yet been contained.
The action of the German bank Deutsche Bank plummeted during the session by more than 13%, due to the rise in the cost of insurance against the risk of default (CDS) of several European banks. Commerzbank fell back 10% when averaging operations.
In a speech before European leaders, gathered for a summit in Brussels, the president of the European Central Bank, Christine Lagarde, assured that the banking sector is “resilient”, according to an EU official.
“The euro area banking sector is resilient, because it has strong capital and liquidity positions,” Lagarde said, according to that source. Lagarde reiterated that the ECB is “fully prepared to provide liquidity to the financial system of the euro zone, if necessary”.
The strength of the European banking sector, he added, is the consequence of having “applied the internationally agreed regulatory reforms after the global financial crisis” of 2008.
In turn, the head of the German government, Olaf Scholz, assured that there was no reason to worry about the solidity of Deutsche Bank. “Deutsche Bank has modernized and organized its way of working. It is a very profitable bank. There is no reason to worry.”expanded and stressed that the advantages of “having had strict rules and regulation for several years are being seen. The banking system is stable in Europe.”
For his part, French President Emmanuel Macron noted that “the fundamentals of European banks are solid. The euro area is the region where the banks are strongest.” And in turn, the Prime Minister of the Netherlands, Mark Rutte, said that “the essential foundations of the banking network and supervision in the bloc give us absolute clarity that European banks are very safe”.
For his part, The president of the Spanish government, Pedro Sánchez, highlighted that the coordinated action of the bloc’s countries allowed “strengthening the resilience of the European banking system”.
The leaders of the EU began a two-day summit in Brussels on Thursday, a meeting that on Friday focused on reviewing the situation of the global banking and financial system and possible risks in the bloc.
Source: Ambito
