Efe Agency: Four Greek banks will not pass the stress tests

Efe Agency: Four Greek banks will not pass the stress tests


By Spiros Sideris – Athens

Once the next few days pending the results of stress tests for the Greek banks, a telegraph of the Spanish agency Efe comes to note that four Greek banks will not be able to complete the process successfully.

Citing unnamed sources, Efe reports that a total of 11 banks will fail to pass the stress tests, with four greek ones among them.

According to Efe, preliminary data suggest that the stress tests that will be officially announced by the European Central Bank on Sunday will fail (apart from the Greek) three Italian, two Austrian, one Cypriot and possibly a Portuguese bank.

However it does not report data for the additional funds that the banks will have to raise, in order  to restore the minimum capital adequacy requirement, since the amounts are subject to changes until the last minute.

In the previous days executives of the Greek banks and the Finance minister Gikas Charvouvelis had estimated that if additional capital needs were identified for the Greek banks, those would be covered easily by the private sector, as was reported by the newspaper “Kathimerini”.

It should be noted that the Greek Financial Stability Fund has EUR 11.5 billion just to cover the capital needs of the Greek banks. The ECB will take the direct supervision of 130 systemic Eurozone banks from 4 November, as part of the banking unification.

It is estimated that the stress tests and the evaluation process for the asset quality (AQR),  which the systemic eurozone banks have undergone in the previous months will dispel any doubts of investors about the health of European banks.

Similarly, the ECB wants the test to be tough and reliable, both to protect its own credibility and also to truly enhance the credibility of banks, so that they will ultimately be strengthened by investors to again be able to lend and support the recovery of the Eurozone.

Denies the European Central Bank

The ECB was quick to deny the information of the Spanish news agency. As announced, the final results of the tests to which it has submitted the european banks have not yet been sent to them and therefore any reference to them is guesswork.