Reuters: Europe's banks face moment of truth from ECB review

23 October 2014

Most banks already have a good idea of how they have fared in the region's bank tests, after getting "partial and preliminary" results from the ECB in recent weeks. But the final numbers were only agreed by senior regulators and supervisors late on Wednesday October 22.

At around noon on October 23, the euro zone's 130 biggest banks received the European Central Bank's final verdict on their finances after a review aimed at drawing a line under persistent doubts about the health of the region's banking sector.

The results will not be made public until 12 noon BST on Sunday October 26, and the ECB has asked banks not to make any disclosures until this point.

Markets are expecting few surprises, and there have already been some reports of how banks have fared including a Tuesday report in Spanish newswire Efe which named 11 banks as having failed and briefly moved the euro.

The ECB's assessment, which is designed to allow the central bank to take over with a clean sheet when it becomes the euro zone's banking supervisor on Nov. 4, is based on the banks' financial positions at the end of 2013.

The banks have strengthened their balance sheets by almost 203 billion euros (160.57 billion pounds) since mid 2013, the ECB says, which implies that several banks which failed are likely to have already raised cash to deal with any shortfall.

Nonetheless, the outcome of the tests will be closely watched.

Full article on Reuters


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