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2017 EBA transparency exercise: Leverage ratios in peripheral eurozone countries

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2017 EBA transparency exercise: Leverage ratios in peripheral eurozone countries

Leverage ratios rose between the end of 2016 and middle of 2017 at the majority of a sample of banks in six "peripheral" eurozone countries, according to data from the 2017 European Banking Authority transparency exercise compiled by S&P Global Market Intelligence.

Leverage ratios rose at 24 of the 41 banks that reported figures as of both periods and fell at 17. In several cases, the impact of capital-raising activity is plain to see: UniCredit SpA's leverage ratio rose 185 basis points after it raised some €13 billion in fresh capital, while that of Caixa Geral de Depósitos SA more than doubled after it received a series of state-backed capital injections.

Meanwhile, Banca Monte dei Paschi di Siena SpA's leverage ratio fell to negative 0.07% ahead of its state-backed rescue, while that of Banco Santander SA dipped 40 basis points to 4.58% ahead of the €7 billion capital increase it carried out after taking over failing Banco Popular Español SA.

The leverage ratio measures Tier 1 capital as a share of total leverage, i.e., on- and off-balance-sheet exposures. It is distinct from the CET1 ratio, which measures common equity Tier 1 capital — the highest-quality form — as a share of assets weighted for riskiness.

Click here for data on leverage in the eurozone core, and for data on CET1 ratios in the core and the periphery.

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Click here to view capital ratios, asset quality, leverage and profitability across 132 European banks that participated in the EBA 2017 transparency exercise.