EBA warns banks to free up lending

THE European Banking Authority (EBA) has warned lenders against being so risk-averse as to prompt a credit crunch.

It also said regulators would not allow a cut in lending as a means to meeting regulatory capital targets.

Banks have changed their behaviour far more than the public has realised in the wake of the financial crisis, EBA head Andrea Enria told German magazine Der Spiegel in an interview.