All German banks have passed EU stress tests: report

25th May 2011, Comments 0 comments

All 13 German banks submitted to European stress tests have passed, the weekly Die Zeit said in its edition to appear on Thursday, citing financial sources.

Hypo Real Estate, which failed tests last year, is in better shape since it transferred toxic assets to an external entity known as a "bad bank," with government help.

Two state-owned regional banks that came close to failing last time, Nord/LB and Helaba, have taken measures to ensure their capital meets criteria set out by the European Banking Authority.

German officials along with the International Monetary Fund and the European Central Bank have nonetheless all urged regional banks known as Landesbanken to consolidate into bigger and stronger units.

The final results of tests designed to verify the health of some 90 European banks are expected in June.

A first round of tests done last year was widely discredited after Irish banks that passed were forced to ask for bail-outs a few months later.

© 2011 AFP

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