September 6, 2016 / 9:01 AM / 3 years ago

Euro zone bank profit rebound not as good as it looks: Nouy

FRANKFURT, Sept 6 (Reuters) - A recent improvement in banking profitability may not be as good as it first appears since much of the rebound was driven by one-off revenues and it remains unclear if banks can continue lifting fees, ECB bank supervisor chief Daniele Nouy said.

“Low interest rates may eventually take their toll: high-yielding assets will either mature or be prepaid, while at the same time any decrease in interest expenses is limited by the zero lower bound on deposits,” Nouy said in an interview with the Eurofi Newsletter on Tuesday.

With bank profits increasingly weighed down by the ECB’s negative rates, analysts expect the central bank to hold rates at their current level at least through next year, easing policy through further asset buys instead of rate cuts. (Reporting by Balazs Koranyi; Editing by Dominic Evans)

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