25 European banks set to fail health checks: sources

FRANKFURT (Reuters) – A group of 25 banks have failed European health checks, while up to 10 of those continue to have a capital shortfall, two people familiar with the matter said on Friday, providing a snapshot of the health of the region’s lenders.

The health checks, led by the European Central Bank, found that banks in countries including Greece, Cyprus, Slovenia and Portugal had fallen short of a minimum capital benchmark at the end of last year and that up to 10 remained in difficulty now, the sources said.

Banks in Spain and France had fared, by and large, better than expected.

The result, which has yet to be finalised by the ECB’s governing council on Sunday, provides the most complete picture yet of the robustness of the euro zone’s top 130 lenders.

Those banks with shortfalls will now have two weeks to submit a plan to bolster their capital to the European Central Bank (ECB), which will decide whether or not it gets the green light.

Meanwhile, Deutsche Bank passed the ECB-led stress test by a wide margin with a core equity ratio of 8.8 percent compared to a minimum requirement of 5.5 percent, two sources familiar with the matter said on Friday.

Juergen Fitschen, co-chief executive of Deutsche Bank and president of the BdB association of German private-sector banks, said the results probably gave his country’s banks a clean bill of health.

Full article: 25 European banks set to fail health checks: sources (Yahoo!)

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