Making Sense of Europe’s Banking Turmoil

Published on16 FEB 2016

With banking shares at the center of market turmoil to start 2016, investors have questioned the health of the financial system. Jernej Omahen, head of European financials research in Goldman Sachs Research, argues that while low rates and deteriorating credit quality have weakened the revenue outlook for lenders, banks retain access to funding and emergency back stop provisions, limiting the risk of a financial crisis.  

European banks in 2016 and ’17 are facing a revenue environment which is challenged. That said, we think that the probability of this morphing into a full-blown stage of a financial crisis… is substantially lower.

- Jernej Omahen

Jernej Omahen
Head, European Financials Research, Goldman Sachs Research