ECB: "Asset quality could start to deteriorate"

"The gradual stabilisation or slowdown in lending growth to households and non-financial corporations, as well as signs of tightening lending standards, support the view that EU banks’ asset quality could start to deteriorate from the currently very high levels in the foreseeable future. Pockets of vulnerability among highly indebted, low-income households and highly leveraged, non-listed firms have become particularly relevant, and banks’ exposures to such borrowers warrant close monitoring."

Source: ECB (p57)