The European Banking Authority (EBA), which conducted the exercise, found an aggregate capital shortfall of only €2.5bn ($3.5bn) at eight banks, prompting criticism that the tests were not tough enough, in part because they did not account for any sovereign failure even as Greece teeters on the brink of default.

A ninth bank, Germany’s Landesbank Helaba, also failed but refused to disclose its result as part of the exercise.

But investors who have studied the results and associated disclosures of the EBA test say the clean bill of health given to the likes of BBVA and Santander in Spain, and Italy’s Intesa Sanpaolo, could provide a timely boost. Such groups have been dragged down by sentiment towards their home countries and have experienced difficulties securing short-term finance at reasonable rates.

“The results draw a distinction between those banks that have unquestionably strong funding and capital and those that don't”, said Daniel Davies, banks analyst at Credit Suisse.

The strength of European banks – and their ability to absorb potential losses in the event of a sovereign default – is a crucial aspect of talks between bank bosses and the continent's political leaders of how Greek debt should be restructured.

Angela Merkel, the German chancellor, said on Sunday that she would attend Thursday’s planned European summit in Brussels only if there was going to be an agreement to resolve the Greek financial crisis, which she believes should involve private creditors.

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