Profitability had been a challenge for Europe’s banks before the pandemic, with tepid economic growth and a low interest rate environment squeezing returns. But key measures of profitability for the region have slumped even further this year, according to The Banker’s 2021 Top 1000 World Banks ranking, based on data from The Banker Database.
Return on equity, already at a none-too-impressive 5.9% in 2020, now stands at just 2.8%; return on capital has fallen from 6.9% to just 3.1%; and return on assets is now at a paltry 0.16%. About 220 European banks are included in The Banker’s Top 1000 ranking.
