Press reports indicate that the Committee for European Bank Supervisors have revealed some details about the pending stress tests. A total of 91 banks in the EU will be tested. It appears the stress being tested for is two-fold: A 3-percentage point deviation of GDP for 2010 and 2011 from the EU's economic forecasts and a deterioration of sovereign risks beyond what was experienced in early May.
The banks being tested represent almost 2/3 of the EU banking sector and at least 50% of national banking sector in terms of assets. The German Landesbank sector and Spanish savings banks will be included. The results will be reported on both the aggregate level and on a bank-by-bank basis.
There has been little market impact from the news. The main consideration today is the elevated risk appetite of the rising equity market.
More on Stress Tests
![More on Stress Tests]()
Reviewed by Marc Chandler
on
July 07, 2010
Rating:
