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Irish Banks - Knee deep in the brown stuff and all alone

This is a really interesting chart from the European Banking Association Transparency exercise report published yesterday

RWA are risk weighted assets (loans) and Capital Effect is the trend in the core capital of the banks
From the report (my emphasis and comments in brackets)

13. An analysis has been carried out to further investigate the driver of the Core Tier 1 capital ratio  evolution and to decompose its variation into capital and RWA components. Chart 5 illustrates the  relative importance of the Core Tier 1 (numerator) and RWA (denominator) effects on the EBA  Core Tier 1 ratio by jurisdiction, which helps to explain whether capital increases have been driven  by injections of new capital or by de-risking and deleveraging. The main results of this analysis are:
a. The improvement of 170 bp (from 10.0 to 11.7%) recorded over the 18 months ending in June 2013 has been the result of both an increase in the EBA Core Tier 1 capital (80 bp)  and a reduction of RWAs (90 bp). [overall banks are healing]
b. In one country (IE, area Q4-b) there has been a reduction of EBA Core Tier 1 capital ratio, due to a decrease of capital, partially offset by a reduction of RWAs. [irish banks shrinking but capital shrinking faster than assets. this is not good...]
c. In eight countries (Q4-a and Q1-a – AT, BE, DE, DK, GB, IT, NL, SI), whose banks account for around 56% of the total, the improvement in the EBA Core Tier 1 ratio has been mainly  driven by a reduction of RWAs. [in the main the improvement comes from deleveraging - smaller banks]
d. In six countries (Q1-b – CY, ES, FR, HU, NO, PT, 35% of the total) the impact of higher  EBA Core Tier 1 capital has been larger than the impact of the decline in RWAs. [these are in effect recapitalising]
e. In six countries (GR, FI, MT, PL, SE and LU – area Q2-a, 7% of the total) the increase in the EBA Core Tier 1 capital has been partially offset by an increase of RWAs.

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