Frankfurt, Germany/AFP
Depositors still have “strong trust” in eurozone lenders, a senior European Central Bank official said Tuesday, seeking to calm nerves after a series of bank failures triggered market turbulence.
“Even in this period of turmoil, the liability side… of the European banks has remained very stable,” Andrea Enria, head of the ECB Supervisory Board, told a European Parliament hearing.
“At the moment, we do have a strong trust of depositors in European banks.”
The recent collapse of Silicon Valley Bank and Signature Bank in the United States, followed by the takeover of Credit Suisse, sparked fears of a wider crisis in the banking sector.
But authorities in leading economies have pledged support for depositors and troubled lenders, while ECB officials have insisted that banks in the 20-nation single currency area are strong enough to withstand the upheaval.
Enria said officials were not seeing signs of major outflows of deposits from European Union banks, unlike what had taken place with some US lenders.
“In general there are different structures… in the markets and different structures (of) the banks’ liabilities that I think make these type of events less likely.
“But in any case, let’s say again I think that our institutional set-up is fit for purpose.”
After days of turmoil, global stock markets were rebounding Tuesday, with bank shares rallying as fears of a financial crisis eased.