Finance
ECB Calls Probe of Riskiest Bank Loans of ‘Fundamental’ Import
- Regulators say 12 banks have been given preliminary results
- Some lenders will have to change policies, central bank says
Photographer: Alex Kraus/Bloomberg
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The European Central Bank defended its controversial probe into banks’ riskiest loans, declaring the issue of “fundamental importance” given the state of the market and warning that some lenders will have to change their practices.
The probe has sparked fierce backlash from banks, and the ECB has been considering cutting in half its initial request for a dozen banks to set aside an extra €13 billion ($14 billion) in provisions to cover potential losses on leveraged loans, Bloomberg News has reported.