‘Cleaning up bank balance sheets is key’

An EU capital market union should be set up to complement an EU banking union in order to rebalance debt and equity financing across the region, according to the chairman of the European Banking Authority (EBA), Andrea Enria.

‘Cleaning up bank balance sheets is key’

The eurozone banking system is still fragile and over-indebted, said Mr Enria, speaking at a lunch in Dublin organised by the Federation of International Banks in Ireland.

“Hence, the most important step is to complete the process of cleaning banks’ balance sheets and providing the right incentives for write-downs and restructuring of private debt, also through debt-to-equity swaps. Several initiatives have been put in place at national levels to facilitate this process,” he said.

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