On the 18th of March the European Banking Authority (EBA) regulator has published parameters and terms of the new stress-tests which are to be passed through by all biggest banks in EU. Authorities use such tests to check lending agencies’ stability in a case of possible crises.
A new series of the stress-tests will take place in April and May this year and the results will be published in June and will be concerned to each bank separately, not to a sector in general. EBA’s specialists note that these tests will be much tougher than the similar examination program of 2010. For instance, according to BBC News all lending agencies will be obliged to disclose information about all their investments in sovereign debts according to payback periods and counties. At the same time the negative scenery will not provide the case of default of the EU government or one of the EU countries.
The tests will affect 65 per cent of the EU banking system; moreover, these stress-tests should be passed through by at least the half of the biggest banks in each EU country. They should explore how stable lending agencies are in the case of the GDP decrease by 0.4 per cent in 2011 and zero growth in 2012.
According to the results of stress-tests which took place in 2010 the majority of the EU banks were considered to be stable in the case of the economic circumstances deterioration. However, later experts criticized the terms of these tests as too soft.
