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Deleveraging Patterns in the Euro Area Corporate Sector
Report

Deleveraging Patterns in the Euro Area Corporate Sector

ECB, 2014 more...

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Editorial Rating

7

Qualities

  • Comprehensive
  • Analytical
  • Scientific

Recommendation

Coming back from the recent recession has been a long, hard slog for many developed economies, particularly Europe’s. Deliberations at the European Central Bank’s headquarters in Frankfurt center on why meager growth persists in the euro zone and how to move beyond it. Given the power and influence of these central bankers, understanding what they are thinking is more important than ever. getAbstract recommends this scholarly but accessible analysis of corporate debt and deleveraging in the EU to executives, bankers, analysts and investors.

Take-Aways

  • Euro-zone nonfinancial companies raised their debt ratios from 73% of GDP at the beginning of 2000 to 100% by mid-2008.
  • While overall leverage for euro-zone corporations has eased only moderately since then, more distinct improvements are evident by country and by sector.
  • Nations and industries that had the highest debt levels and the greatest reliance on banks have deleveraged the most. For example, in Ireland and Spain, the construction and real estate sectors have shown notable debt declines.

About the Author

The European Central Bank is the monetary authority of the euro zone.