More banks face EU stress tests

A SECOND round of banking stress tests will examine more than 120 institutions in Europe, and could also include checks on each bank’s exposure to debt from at-risk countries.

Analysts have warned that the EU risks further unsettling investors by treating bonds from Greece and other countries as liable to failure, even in tests.

The next wave of checks is a bid by the European Central Bank and other banking
regulators to instil investor confidence as details of the original 25 tests on larger banks emerge.

Deutsche Bank, BayernLB and Commerzbank all passed their liquidity checks, according to reports last night, though the tests did not involve looking at exposure to sovereign debt.

The full results for the first 25 tests are set to be published at the end of July.

Germany’s central bank and financial market watchdog are set to meet with the country's largest banks to discuss test results today.