ECB Vice President Luis de Guindos said that ” recent softening of the macroeconomic growth outlook” and the “associated low-for-longer interest rate environment” are likely to weigh further on banks’s profitability prospects.
He noted “many market analysts are concerned about the drag on bank profitability that could result from the negative impact of monetary policy accommodation on net interest margins”. And, “net interest margins are indeed under pressure”.
He also said that recession in Eurozone is a very unlikely event. Meanwhile, the central banks won’t reach the limits on the QE program shortly.
