Germany’s fiscal stimulus to decisively address its longstanding investment gap and immediate security needs could lead to EUR 625bn of new debt over five years, or 13% of GDP. However, sustaining long-term growth potential will require further reforms.

Europe’s real estate firms find funding respite but refinancing challenge looms; covered bonds provide stability in turbulent times; non-prime office segment faces rising vacancy rates; what can Frederick the Great tell us about today’s capital markets?

European corporate hybrid bond issuance could reach EUR 36bn in 2025, driven by a busy call schedule and lower subordination premiums. Almost EUR 25bn of hybrids hit call dates this year, rising to EUR 38bn in 2026.

Our distressed house price decline (HPD) benchmark assumptions for structured finance transactions have been updated to reflect real estate market vulnerabilities in 18 European countries under a severe economic shock.

UK bank profitability will remain high in 2025, supported by net interest income, a recovery in loan growth and positive contributions from structural interest-rate hedges. But profits will likely decline from previous highs.

France is heading towards difficult budgetary trade-offs to reconcile the government’s commitment to lower budget deficits while increasing defence spending given the country’s central role in strengthening Europe’s security architecture.

Is Germany at an inflection point? The expected coalition deal between the CDU/CSU and the SPD will set the course for whether Germany can boost defence spending, kick-start growth and restore competitiveness after five years of stagnation.

Italian NPL collections fell 62% in January 2025 month-on-month, tracking the same trend observed between December 2023 and January 2024 (-60%).

Scope Ratings today updates its Aviation Finance Rating Methodology. Scope’s existing ratings of aviation finance and aircraft non-payment insurance instruments are not affected.

The outcome of Germany’s election facilitates a CDU/CSU and SPD coalition agreement, though reforms to Germany’s debt brake, needed to help tackle acute security and economic challenges, will remain challenging.