Banks’ vulnerability highlighted by EU

The vulnerability of the country’s banking sector was central to the European Commission’s macroeconomic report on the economy, warning that there was some uncertainty on the outcome of forward stress tests and the need to tackle tracker mortgages.

Partly because of the concerns over the banking sector, including the EU’s highest percentage at 27% of non performing loans, the commission is to monitor the economy more closely, together with the post troika bailout programme bi-annual visits.

The Irish banks have one of the highest capital ratios in the eurozone with loan-to-deposit ratios gradually converging to the eurozone average.