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EU still haggling over bank stress test


EU still haggling over bank stress test


Even though the latest round of European bank stress tests are already underway, EU regulators are still haggling over how tough they should be.

A second round of tests of how the region’s banks would cope with crisis has been rolled out because the those carried out last year were deemed to be inadequate.

Europe’s new banking watchdog – the European Banking Authority – has said it will apply stricter rules but exactly how strict has yet to be agreed.

At issue is how much capital lenders should have set aside in order to withstand economic shocks.

Stress testing of about 90 European Union banks began this month, and on Friday the EBA published details of the economic shock that will be applied to individual banks and the test’s methodology.

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