The European banking sector is gaining strength based on high levels of office leasing activity in the past year, according to a report from commercial real-estate brokers Cushman & Wakefield.

During the period April 2010 to March 2011, take-up of office space by banks across Europe has been 20% above the five-year average. The major banking centres of London, Paris and Frankfurt continue to dominate, accounting for just over 55% of total banking office leasing in Europe over the past year.

Office leasing was particularly strong in the cities of Warsaw and Prague. Warsaw, which is establishing itself as the regional banking hub for central and eastern Europe, saw take-up soar almost 63% higher than the five-year average.

Matthew Knight, associate at Cushman & Wakefield, said: “The European banking sector is continuing its recovery with a marked improvement in sentiment in the occupational office market. However, banks still face significant uncertainty deriving from a number of issues. Possible restructuring of sovereign debt in Greece will have significant knock-on effects for banks in the country, as well as international banks exposed to Greece, notably German banks with nearly €20bn exposure.”