28th Sep 2020

Barroso calls for bank stress tests to be released

  • The EU's main banks are currently being tested for their ability to withstand financial shocks (Photo: Wikipedia)

European Commission President Jose Manuel Barroso has asked EU leaders meeting in Brussels on Thursday (17 June) to allow the results of stress tests, currently being carried out on the region's biggest banks, to be made public.

"This would help to lift unfounded suspicion," Mr Barroso reported said, according to an EU source close to the talks. The commission is pushing for the summit's final conclusions to contain a declaration on the tests, which it says should be published on a "bank-by-bank basis".

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The statement adds to a growing groundswell of support for publication of the results, after Germany performed a dramatic U-turn on Wednesday.

Germany "is positive toward the publication of results of European Union stress tests," finance ministry spokesman Michael Offer said. "We see that markets are worried and trust among banks is tarnished. Transparency can be helpful as a stabilising factor."

Berlin's move comes despite opposition from the country's regional banks - the Landesbanken - which are suspected on harbouring substantial losses, as yet undisclosed.

France and the UK have also indicated their willingness to publish the test results, with Spain the principle driver behind the motion. Madrid believes the tests will help dispel market concerns over the health of the country's banking system.

Sources say Banco Santander, Spain and the eurozone's largest bank, is set to come out well in the tests.

The Committee of European Banking Supervisors is currently undertaken tests on Europe's 25 largest banks, and is due to present its results to the European Parliament's economic committee by late June or early July, say reports.

Only very limited results were released from last year's European tests.

Washington has been critical of European desires to keep the results secret, with results of tests on US banks being made public last year.

With markets hungry for a EU leaders' statement on Spain, rumoured to be on the verge of asking for financial support, a declaration on stress tests may help to calm investors' fears.

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