• First report by the Joint Committee of the European Supervisory Authorities (ESAs) on cross-sectoral risks facing the EU financial system;
• Key risks facing EU financial markets include weak macroeconomic outlook; low interest rate environment; risk of further fragmentation on the single market; increased reliance on collateral; the quality of financial institutions’ assets; lack of confidence in financial institutions’ balance sheet valuations and risk disclosure; loss of confidence in financial benchmarks;
• The ESAs have closely monitored the situation in Cyprus as it has developed. The events will lead to losses throughout the financial sector in Cyprus. However, the risks of direct international contagion seem to be limited.

Full Press Release.