David Scutt

Here is the link to the ECB's AQR (stress-testing) results that came out late yesterday evening. In total 25 European banks were found to have capital shortfalls, half of which have already been covered, with the cumulative amount of additional capital to be raised coming in €25b. All-in-all it's probably better than what markets had been anticipating, and will likely add to improved risk sentiment seen over the past week. (VIEW LINK)


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David Scutt

The result look good because the ECB's 'adverse' scenario doesn't factor in any likelihood of deflation. They'd look significantly worse if that criteria had been tweaked. Has already raised plenty of scepticism about robustness of the testing, particularly as many member states are already experiencing deflation. My biggest gripe is that just because the ECB don't forecast it why it is not deemed a risk? As we've seen from them on numerous occasions their forecasts, and then reality, often don't come close.

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James Marlay

Most of the press I have read on this seems to be reasonably relaxed about the outcomes. No major surprises on the banks that still have work to do and for investors a sense that banks are being closely watched and evaluated on an even footing.

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