Interview with Philip R. Lane, Member of the Executive Board of the ECB, conducted on 22 March by Kolja Rudzio

29 March 2023

In recent weeks, banks have collapsed in the US and Switzerland. Could the same happen in the eurozone?

Let me first strongly emphasise that what we’re seeing in the euro area in terms of tensions is a spillover from the US and from Switzerland. And please remember that we had a severe banking crisis in the European Union 15 years ago. As a result of that, we now have very tight regulation and very tight supervision of the banks. So our baseline is that the European banking system has a lot of capital and banks have been prudent in their lending decisions.

“Baseline” means you think this is the most likely scenario.

Yes. Of course we’re closely monitoring developments and are on our guard, but we don’t expect to see the same situation as in the US or in Switzerland to be the most likely scenario here in the euro area.

You don’t expect it, but you…