The data contained in this publication has been compiled from publicly available information released by the European Central Bank, European Commission, Eurostat, the European Banking Authority, national competent authorities and members of the European Banking Federation. Unless otherwise noted, all graphs and tables have been produced to illustrate the figures mentioned in the relevant chapters.

Due to rounding, figures presented in the charts throughout this document may not sum.

General trends

The core banking activities of raising deposits from and providing credit to customers are crucial to Europe’s banks. Private sector deposits and loans grew in 2018, particularly for households and non-financial corporations.


Domestic or euro area deposit liabilities in the EU rose by 2.8% to €23.5 trillion, excluding euro area deposits of non-euro area monetary financial institutions (MFIs). France accounted for more than half of the increase, with deposits up €346 billion. Monetary financial institution deposits in France increased by almost €185 billion. Similarly, deposits of non-MFIs excluding central government rose by €162 billion in France, by €109 billion in Germany and by €113 billion in the United Kingdom.

Deposits from other MFIs rose by 2.2% in the euro area in 2018 but fell by 5.1% in the rest of the EU, mainly driven by a drop in the United Kingdom.

Total deposits from non-MFIs, excluding central governments, grew by 3.6% in 2018 to €16.9 trillion in the EU at the end of 2018, with €12.1 trillion in deposits in the euro area.

The growth continues to be driven by an increase in deposits from households (including non-profit institutions serving households), which rose by 4.2% year-on-year to €9.6 trillion and non-financial corporations (NFCs), up by 3.6% to €3.4 trillion.

Germany accounted for about one third of the €314 billion increase in euro area household deposits in 2018. France contributed about one fifth.

The ECB reported continued strong growth in overnight deposits in the euro area with more than €7.1 trillion in overnight deposits from non-MFIs, excluding central government vis-à-vis MFIs and central government at the end of 2018, some 6.8% more than at the end of 2017. This was the 51st consecutive month in which the annual growth rate in overnight deposits had exceeded 6%.


The total value of loans outstanding from EU MFIs increased by 2.5% in 2018 to more than €25.1 trillion. The increase mainly came from growth in loans to non-MFIs, excluding general government, which rose by 3.4% year-on-year to almost more than €15.5 trillion.

As with deposits, France accounted for four fifths of the €602 billion increase in loans outstanding in the EU.

Loans to EU households rose by 2.5% in 2018 to €8.3 trillion, rising slightly faster in the euro area.

Loans to households in the euro area grew for the fourth successive year, adding almost €540 billion on loans outstanding since 2015.

NFC loans outstanding in the EU rose by 3.8% in 2018 to almost €5.5 trillion, the highest level since 2012

Loans adjusted for loan sales, securitisation and notional cash pooling continued to grow in the euro area in 2018. Annual growth rates on adjusted loans to the private sector have been positive since the first half of 2015, with the annual growth rate of adjusted loans to households and NFCs at 3.2% and 3.9%, respectively, in December 2018.

Real estate activities, professional, scientific and technical activities and administrative and support service activities accounted for more than one third (36.2%) of loans outstanding at the end of 2018, and up from 30.8% in Q4 2008. Manufacturing and the wholesale and retail trades accounted for 14.4% and 13.1% respectively.

Lending standards, i.e. banks’ internal guidelines or loan approval criteria, continued to ease in the euro area throughout 2018 for loans to both SMEs and large enterprises, reflecting the general trend evident since 2014.

Bank Lending Survey

Net demand for new lending remained positive in 2018, with the net percentage of banks reporting an increase in SME loan demand, broadly stable since the start of 2017, and between 12% and 17%.

The Role of Banks: lending and payments

Banks act as facilitators between those who have money and those who need money, while also providing the systems for funds to flow between payers and payees.

The primary role of banks is to take in money from those with cash in hand and to lend money to borrowers. Banks then receive loan repayments which can be used in new lending to other borrowers.

The traditional view of this process has been that banks “create” money by providing some of the money on deposit in the form of loans to borrowers, which returns to the banking system as deposits. This money can then be lent again and again, resulting in a multiplier effect. More recently, money creation has focused on how lending creates bank deposits i.e. whenever a bank provides a loan to a customer, a deposit is created.

Banks cannot lend freely without limits. They have to be able to lend profitably in a competitive market, while also managing liquidity risks (i.e. they have sufficient liquid assets to repay depositors or investors when required) and credit risks (some borrowers may not repay their loans). These lending activities are regulated and safeguarded by global/international standards and EU regulations.

Just as money can be created, it can also be destroyed. For example, in the case of a mortgage being used to purchase a second-hand property, the purchaser could use the proceeds from the sale to pay an existing mortgage, effectively bringing the amount of money created back to zero.

Banks are also key players in national and international payment systems. Almost 90 billion cashless payments were made by non-MFIs in the EU area in 2018. Slightly less than half (42 billion) of those were card payments, while about a quarter were credit transfers (21 billion) or direct debits (21 billion).

The popularity on online and mobile banking continues to grow with some 54% of individuals (64% of those who used the internet in the last three months) used Internet banking in the EU in 2018, up from 47% in 2008.

The Single European Payments Area (SEPA) aims to harmonise and integrate payment markets across Europe, with one set of euro payment instruments: credit transfers, direct debits and payment card, common standards and practices and a harmonised legal basis. SEPA covers more than 520 million people in the 28 EU Member States and six non-EU countries (Iceland, Liechtenstein, Monaco, Norway, San Marino and Switzerland).

The Number of ATMs in the European Union totalled in 2018 about 432,000, which is an average of 1,182 inhabitants per ATM, down from 1,112 in 2014 when Europe reached the highest number of ATM with 455,711.

As far as convenience and accessibility of banking services are concerned, Austria and Portugal lead in terms of the number of inhabitants per ATM, the parameter being 708 and 711 respectively. At the same time the least number of inhabitants per ATM was registered in Sweden, Finland and the Netherlands. In each of these countries there are between 3,812 and 2,689 inhabitants per device.