Have European Banks Actually Changed Since the Start of the Crisis?

This paper documents trends in key bank variables over the 2003-2013 period for the set of banks that the ECB directly supervises as of January 30, 2015. This time period enables us to see how the crisis has affected the banks, and also how they have changed since the crisis. A range of variables is considered that together provide a picture to what extent banks have been moving in the direction of better performance and greater stability. These variables include indices of banks’ overall business model, size, off-balance sheet exposures, and internationalization. In addition, we consider several variables that inform about banks’ asset portfolios, funding strategies and capitalization. The identified trends provide a mixed picture of whether banks have been moving in the right direction since the start of the crisis.