Four major Swedish banks pass EU stress test - Eight European banks failed


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Friday, 15 July 2011
The four major Swedish banks perform well in the EU stress test carried out by the European banking authority on Friday. Eight other European banks failed signalling that they could not cope with an economic crisis.

On Friday evening, European Banking Authority EBA's presented the results of the stress test for Europe's largest banks. The major Swedish banks Swedish banks, Swedbank, Nordea, Handelsbanken and SEB did well indicating that they have enough capital to cope with even more extreme crisis situation.


The test shows among others how much capital is needed in the banks in various types of crisis scenarios. The test is a hypothetical scenario which will include how banks with act in time of reduced GDP growth by four percent compared to the 2011- 2012 EU Commission forecast.
This year's test is the third since the global financial crisis. Stress tests are conducted to manage the market and reduce uncertainty and surprises fall.

Nordea Chief Economist Annika Winsth is on the whole satisfied with the results.
“All Swedish banks fared very well. The Nordic banks are generally strong,” she says.

Last year, the equivalent stress test met criticism that it was too lax. Now the requirements have been tightened and Annika Winther says that this year's test is more transparent, but the requirements are still too low.

“That there are only eight banks that fail and that only €2.5 billion as defaults, however, there is some disappointment. The market had expected more banks to fall and considerably more capital requirements,” she says.
The banks that failed are
CAM, Banco Pastor, Caja 3, Unnimm, Catalunya Caixa
EFG Eurobank, ATE Bank
�sterreichische Volksbanken AG
By Team

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