Draghi calls for action on non-performing loans
ECB president praises recent Italian reforms
Eurozone countries need to take action on resolving their banking systems' non-performing loans (NPLs), the European Central Bank president said on December 14.
NPLs dampened eurozone credit supply in several ways, Mario Draghi told an audience in Bologna. They tied up banks' capital "in unproductive uses" and absorbed their operational capacity. By reducing their profitability, NPLs reduced banks' capacity to "generate capital internally".
The consequent limitation of the supply of capital
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