Tuesday 16 October 2018

ECB backtracks on tougher NPLS rules

European Central Bank headquarters in Frankfurt, Germany
European Central Bank headquarters in Frankfurt, Germany

THE European Central Bank's efforts to tackle the Eurozone's stubbornly high volume of non-performing loans suffered a setback yesterday amid a reported backlash from politicians and lawyers who accused the regulator of overstepping its mandate.

While the new rules were expected to weigh most heavily on Mediterranean markets, particularly Italy, there were fears the tougher regime could force aggressive balance sheet purges from Permanent TSB, and to a lesser extent AIB. PTSB holds the highest stack of NPLs among the Irish lenders with soured debts representing 28pc of its total loan book. The new guidelines would have forced lenders to hold more collateral against troubled loans that emerge after January 2018.

Irish Independent

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