Sunday, October 26, 2014

25 EU banks fail "stress test" ... don't you just love the newspeak!

Although the BBC piece below gives the number as "24"  ... the chart at ZeroHedge shows the number to be "25" and has a lot more info.
Wonder how the stock market manipulators will manipulate the EU market due to open in the next few hours.  Will they make this look like a good thing that only 25 banks out of 123 tested were a bit under the weather?  Yup ... I bet that's how it will be. You can trust the doctors doing the "stress test"  to doctor the patients in other areas too.  
Our brave new world!

From BBC:
Twenty-four European banks fail EBA stress test  
Twenty-four European banks have failed stress tests of their finances, the European Banking Authority has announced.
The banks now have nine months to shore up their finances or risk being shut down. No UK banks are included.
The review was based on the banks' financial health at the end of 2013.
Ten of them have taken measures to bolster their balance sheets in the meantime. All the remaining 14 banks are in the eurozone.
The health check was carried out on 123 EU banks by the EBA to determine whether they could withstand another financial crisis.
The list of 14 includes four Italian banks, two Greek banks, two Belgian banks and two Slovenian banks.
The worst affected was Italian bank Monte dei Paschi, which had a capital shortfall of €2.1bn (£1.65bn, $2.6bn)...........

From ZeroHedge:
As was leaked on Friday,  when the market surged on news that some 25 banks would fail the ECB's third stress test (because in the New Normal more bank failures means more bailouts, means the richer get richest, means more wealth inequality), so moments ago the ECB reported that, indeed, some 25 banks failed the European Central Bank's third attempt at collective confidence building and redrawing of a reality in which there is about €1 trillion in European NPLs, also known as the stress test.

The ECB's results as summarized by the central bank:
Capital shortfall of €25 billion detected at 25 participant banks
Banks’ asset values need to be adjusted by €48 billion, €37 billion of which did not generate capital shortfall
Shortfall of €25 billion and asset value adjustment of €37 billion implies overall impact of €62 billion on banks
Additional €136 billion found in non-performing exposures
Adverse stress scenario would deplete banks’ capital by €263 billion, reducing median CET1 ratio by 4 percentage points from 12.4% to 8.3%.........

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