Are banks in the euro zone creating their own future problems?

Share prices of euro-zone banks have fallen markedly since the start of 2018: investors seem to be pessimistic about these banks’ future financial situation. Can we expect problems for these banks? Indeed: They are granting fixed-rate loans at very low interest rates; this will lead to significant interest rate risk in their balance sheets if they do not hedge their lending by issuing long-maturity bonds; The rise in risk perception since the start of 2018 has increased the banks’ cost of bond financing more than their interest rate margins on loans; The euro yield curve is very flat and the unemployment rate in the zone is very close to the structural unemployment rate: these banks will be unable to accumulate significant profits before euro-zone growth slows down.