AFME is pleased to share the Prudential Data Report for the first quarter of 2026. The report provides updated data on European G-SIBs’ prudential capital, leverage, and liquidity positions, and illustrates the performance of banks’ debt and contingent convertible (CoCo) securities.
Among the main findings of this report:
Capital and liquidity buffers remain strong
- The CET1 ratio of European G-SIBs stood at 14.4% in Q1 2026, 20bps above the level observed in Q1 2025 and 8bps below the levels of Q4 2025.
- The -8bps quarterly variation was primarily driven by retained earnings (+52bps), partly offset by shareholder returns(-45bps). Changes in RWA had a smaller effect, decreasing the ratio by 17bps, while FX translation and other factors provided a net contribution of +2bps.
- The leverage ratio of EU GSIBs reached 4.37% in Q1 2026, a slight decrease from 4.41% in Q4 2025.
- Liquidity coverage ratios stayed well above regulatory minimums, at 144.4% on average.
- TLAC ratios remained well above minimum regulatory requirements across all institutions.
Focus on AT1 Contingent Convertibles (CoCo)
- AT1 CoCo issuance reached €15.6bn in Q1 2026, a 110.5% increase YoY (compared to €7.41bn issued in Q1 2025).
- CoCo instruments carrying an equity conversion loss absorbing mechanism made up 50% of Q1 2026 issuance, while the remaining half feature principal write-down triggers.
- The share of investment‑grade CoCo issuance continued to rise, accounting for over 60% of issuance during Q1 2026.
Box: Stakeholder views on the European Commission’s Banking Competitiveness Consultation
The Box on page 22 provides an analysis of stakeholder responses submitted to the European Commission’s Banking Competitiveness Consultation.
- This analysis focuses on selected consultation questions in areas considered relevant to banking competitiveness. These are: complexity of prudential framework, impact of regulation on banks' valuation, application of prudential requirements (consolidated or entity-level), output floor, SyRB, OSII buffer, and MREL.
- We find strong and consistent consensus across stakeholders that the prudential framework is excessively complex, with broad alignment that it contributes to the undervaluation of EU banks.
- There is clear stakeholder support for reviewing key elements of the framework, notably MREL and the O‑SII buffer.
- We observed divergence between stakeholders and public authorities in other areas, with stakeholders generally favouring review of SyRB, output floor, and the level of application of prudential requirements (currently at both consolidated and entity-level) while authorities show more caution and greater support for maintaining existing tools and approaches.