Eurozone Banking Sector Faces Severe Profitability Shock: ECB

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Brussels: European Central Bank chief economist Peter Praet on Tuesday said the Eurozone banking sector is facing a severe profitability shock, pointing to high costs, an excessive amount of bad debt in some countries and lack of necessary consolidation.

“We have in the sector a severe profitability shock,” Mr Praet told a conference in Brussels.

Mr Praet said the sector would benefit from the formation of pan-European banking groups and the completion of the banking union.