Government bond markets provide a crucial safe asset for the euro area banking sector. They are intermediated “over the counter” by a group of dealer banks whose balance-sheet space has become more costly since the Great Financial Crisis. As sovereign issuance has risen and has stayed elevated, pressures on banks’ capacity for intermediation between buyers and sellers may increase. Using security-level Securities Holdings Statistics for euro area primary dealers from 2018 to 2025, we describe the composition of euro area banks’ exposures and associated risks. We also analyse the evolution of banks’ balance sheet utilization […]