Bank profitability: a Mirror of the Past, Creating a Vision for the Future

On 19 October 2023, the Council of the European Union appointed Claudia Buch as Chair of the Single Supervisory Mechanism (SSM) of the European Central Bank (ECB). She assumed her role on 1 January 2024 for a five-year term. Prior to her appointment as Chair of the SSM, Ms. Buch was Vice-President of the Deutsche Bundesbank, where her responsibilities included banking and financial supervision as well as financial stability. In that capacity, she was already a member of the SSM.

On 16 October 2024, Claudia Buch delivered a lecture titled Bank Profitability: A Mirror of the Past, Creating a Vision for the Future at Bocconi University. The event was co-organized by the Baffi Center on Economics, Finance, and Regulation and the Institute for European Policymaking at Bocconi University (IEP@BU).

The event was chaired by Donato Masciandaro, Director of the Baffi Center, with closing remarks made by Daniel Gros, Director of IEP@BU. Brunella Bruno, a researcher, and Professor Filippo De Marco from Bocconi University, also provided comments on Ms. Buch’s lecture.

“Bank profitability in Europe has increased in recent years. In some ways, the current levels of bank profitability mirror the past – structurally, by reflecting differences in markets and banks’ business models, and more cyclically, by reflecting the changing macroeconomic environment and higher interest rates. This raises the question as to whether profitability is a good metric for assessing bank resilience or if there are other indicators we should consider”, Claudia Buch argued.

You can read the full speech on the ECB website

IEP@BU does not express opinions of its own. The opinions expressed in this publication are those of the authors. Any errors or omissions are the responsibility of the authors.

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