The European Central Bank (ECB) said yesterday that record low interest rates were putting insurance firms and banks under increasing pressure and warned that any sell-off in stocks and bonds could damage the Eurozone's recovery.
In its twice-yearly Financial Stability Review, the ECB also said risks from Greece for the Eurozone's governments had "increased sharply" but that their borrowing costs and growth prospects were being helped by measures like the ECB's bond-buying programme.
The negative side-effect of that though was the squeeze it was putting on insurance firms who are finding it increasingly difficult to find assets that pay out enough to cover their costs, and for banks in terms of their profitability.
The ECB's message echoes similar warnings from the International Monetary Fund (IMF) and one of Europe's top regulators earlier this month.
"Such market conditions pose a significant challenge for some insurance companies' profitability in the medium term, with the potential to erode capital positions in the long run," the ECB report said.
"The impact of the low interest rate environment is particularly relevant for those life insurers that have locked in high return guarantees and have large asset/liability duration gaps."
Overall the ECB said there were four main risks to the Eurozone's financial stability at present.
The bank's Vice President, Vitor Constancio, said the biggest was that a sharp bond and stock market sell-off could derail the bloc's still fragile economic recovery.
He also flagged worries such as debt sustainability concerns in the sovereign and corporate sectors.