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April 30, 2021

A&M’s first edition of the European G-SIBs Pulse (“The Pulse”) Q4’ analyses eleven leading Europeans banks (of which ten are known as the European G-SIBs) and highlights the top performers based on three key areas:

  1. Business profitability
  2. Balance sheet resilience
  3. CO2 footprint estimation

In addition, we have added a ‘Merger & Acquisitions’ section with the objective of understanding the value and risk of all potential (and challenging) integrations in the European market. This report aims to help banking executives and board members stay current on industry trends.

All the data used in this report has been obtained from publicly available sources. The methodology for all the calculations is homogeneous and discussed in the glossary.

Headline trends for 2020 EoY include:

  • Loans and Advances (L&A) decreased this year by 1.5% driven by households' loans drop, deposits grew at a 6.4% pace
  • Net Interest Margin (NIM) decreased slightly to 1.07%, driven by yield on credit decrease despite cost of funds decrease
  • Operating income margin also decreased driven by lower NIM and fees & commissions
  • Cost to Income (C/I) ratio stable close to 65% as a result of the lower income and lower costs
  • Non-performing Loans (NPL) ratio slightly increased. Cost of Risk (CoR) increases as well to 70 bps (x1.8)
  • Return on Equity (RoE) and other profitability ratios show a significant decrease due to the increased provisioning for loan losses
  • CET1 fully loaded ratio increased 71 bps to 14.2% driven by the dividend restrictions and a decrease in RWA
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How can A&M help?

A&M’s dedicated Financial Industry Services practice helps financial institutions, government enterprises and Central Banks, and other financial services companies to successfully execute business strategy and maximise growth, while minimising risk and navigating regulatory issues.

A&M has relevant and credible skills and capabilities to assist financial institutions with the challenges mentioned: A&M can help transform, restructure and optimise performance by managing revenue, cost, risk, regulation, strategy and digital transformation.

If you would like to discuss the findings from our analysis in more detail or would like a copy of the comprehensive report, please contact Alberto Gil.

Euro Banking Pulse

The Euro Banking Pulse is a report based on analysis by A&M into the 24 largest European banks in 2018, scoring each of them against Key Performance Indicators (KPIs) linked to both profitability and resilience using proprietary calibration based on the European Banking Authority (EBA) and A&M thresholds.