“European banks are sitting on bad debts of €1tn – the equivalent to the GDP of Spain – which is holding back their profitability and ability to lend to high street customers and businesses.  The €1tn (£706bn) of so-called non-performing loans amount to almost 6% of the total loans and advances of Europe’s banks and 10% when lending to other financial institutions are excluded. The equivalent figure for the US banking industry is around 3%. As well as bad debts, the EBA pointed to the cost inefficiencies and the cost of so-called conduct issues, such as fines, compensation and legal costs, which absorb almost 4% of banks’ operating income.”

http://www.theguardian.com/business/2015/nov/24/european-banks-one-trillion-euros-bad-debt

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