SREP results: euro area banks maintain a sound capital and liquidity position and improved profitability

The European Central Bank (ECB) published the results of its Supervisory Review and Evaluation Process (SREP) for 2022. In this process, supervisors adopt an overall assessment of the challenges facing significant institutions, together with the corresponding capital requirements and other supervisory measures that banks are expected to comply with for the year ahead, in order to better face these challenges.

The results show that the euro area banks maintained a sound capital and liquidity position, with vast majority of them holding more capital than they should have according to the capital requirements and guidance adopted in the previous SREP cycle. Despite the outlook worsening throughout the year, banks improved profitability and capital generation as interest rates rose. The average overall SREP score in 2022 was broadly unchanged, with 92% of the banks covered receiving the same overall SREP score as in 2021. Half of the remaining 8% saw their score worsen. Supervisors have again imposed qualitative measures primarily in the areas of credit risk and internal governance.

The press release and the SREP 2022 results are available on the ECB's website.