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’Ireland’s stress test results [updated]
Here’s the full report, click image to open:
The bank recapitalisation grand total: €24bn
Allied Irish Banks: €13.3bn
Bank of Ireland: €5.2bn
EBS: €1.5bn
Irish Life & Permanent:
Those European stress test details
In case you forgot that other crisis…
The European Banking Authority has just published parameters for the upcoming European bank stress tests. A first glance has them about as meek as expected.
Major points and assumptions below:
How stress tests make Europe’s bank funding worse
Set aside those unrealistic macroeconomic assumptions in Europe’s stress tests.
Focus instead, on the complete lack of a sovereign bond ‘shock; in the 2010 version. And that’s despite the whole sovereign-bank loop thing,
Back to the future with Europe’s stress tests
There are plenty of strange things about Europe’s banking stress tests. Notably, the idea of engaging in a test which is meant to assure nervous investors with its rigorousness — but not frighten them too much by actually finding big problems.
A stress test mugged by reality
The thing you want from a bank stress test is for the ‘stress’ to be much tougher than anything that could really happen in reality. A good kitchen-sinking, in other words.
By that standard, European stress-testing is in the toilet.
Interesting, odd and odious sovereign debt ideas
Idea No. 1, from ECB board member Lorenzo Bini Smaghi:
More generally, this crisis has shown the vulnerability of public finances to volatile structures in the economy. In good times, volatile sources of income,
US banking stress tests 2.0 – an update
Aka — could your desire to release dividends survive a double-dip?
FT Alphaville reported back in November that the US Federal Reserve was looking at whether bank holding companies could distribute capital again without putting themselves — and everyone else — in danger.
Bail out Portuguese and Spanish banks together?
Portugal’s bailout is pretty much priced-in, right?
Well — it might be time to consider an intriguing, and plausible, game-changer.
According to Marco Valli, chief eurozone economist at Unicredit,
Europe’s stress test was RIGHT
Ancient Greek mothers would often finish mythic tales told to their children (wholesome stuff like Oedipus, Electra and so on) with ‘…and then the story came true’, goes an apocryphal historical canard.
BIS > stress tests
Here’s more on those big BIS numbers on banks’ peripheral exposure, complete with a faint haughty whiff of ‘my banking statistics are better than yours’.
We merely think it’s a useful public service announcement.
Building a better European stress test
Peaking over the horizon this Tuesday — some more European banking stress tests.
Via Reuters:
Dec 7 (Reuters) – The European Union will begin a new round of tougher stress tests for banks in February as part of its response to dealing with the debt crisis,
Stress tests – the sequel
Ireland’s sort-of doing it — and now the US definitely is.
Stress tests v.2.0, that is.
Late on Wednesday, the US Federal Reserve issued its guidelines for financials that want to start paying out dividends again.
AIBaiting
Irish bank bail-out outrage du jour comes courtesy of Guido Fawkes.
The British political blogger has unearthed a purported copy of Anglo Irish’s foreign bondholders as of October 15 — quite a feat given Ireland’s finance minister Brian Lenihan once said he was unable to do the same.
Testing the sovereign-bank loop
As we watch for signs of reawakening European sovereign fears, here’s an interesting pair of charts to ponder, courtesy of Markit:
And as Markit credit data analyst Lisa Pollack observes,
CEBS says the stress tests were JUST FINE
We weren’t that taken aback by the WSJ’s recent, ah, exposé revealing that Europe’s recent stress tests were – shock! – perhaps less than helpful on the actual exposure of banks to risky sovereign debt.
As ye stress-test, so shall ye reap
The folly (via the WSJ)…
The template asked for banks to disclose their “gross” and “net” exposures to sovereign risk in each E.U. country. Most banks’ disclosures didn’t define “gross” and “net” beyond saying that the latter were “net of collateral held and hedges”…
Not stressed but skittish
RBS are back with an update of their European stress test tracker. And they’re starting to sound a wee bit nervous, noting that, “the stress tests might have failed to ring fence the periphery.”
RBS says stress tests were a success – in the first week
Did stress-testing the sovereign exposures of European banks help soothe the market?
On Monday July 26, shortly after results of the tests were published, the analysts at RBS came up with seven indicators that might suggest whether the exercise had ‘succeeded’ in terms of sentiment.
Das Stressometer
CreditSights has created a sort of EU bank stressometer.
In their words, it seeks to “exploit” the additional disclosure on sovereign risk published in the CEBS-administered European bank stress tests.
Deutsche Bank plays the ‘good German’
So Deutsche Bank has decided to set a good example to its peers and play ball with Europe’s bank regulators — sort of. Amid European mutterings about German bank recalcitrance — i.e. the refusal by six German banks to publish their government debt exposure as part of European banking stress tests – Deutsche said on Monday it would publish full details of its sovereign holdings.
Of butterflies and stress tests
How are the European bank stress tests like a butterfly?
We think we know — thanks to Deutsche Bank’s take on the Spanish banks’ stress-test results on Monday.
Deutsche have probed the provisions on loan losses,
Monday funding fears
So much for any interbank market relief after the stress tests.
The below just out from the European Banking Federation:
That’s about a one-year high for the Euro Interbank Offered Rate.
The slow upward grind of money market rates is a bit of an issue for some European banks.
Gaming the stress tests 101
This probably would have been more useful before July 23, but oh well.
Much like the US stress tests conducted in the spring of 2009, the European version possessed a couple of pretty significant loopholes for participating banks.
Let’s talk ‘real’ stress – and real recapitalisation, says BarCap
Not with a bang but a bleat did the results of the European bank stress tests arrive on Friday.
Seven of the 91 European banks tested were found to need just €3.5bn of additional capital, most of which they are already in the process of raising.
Stress test’s sovereign support = senseless
Amongst all the criticisms of the European stress tests, there’s one glaring omission.
From the Committee of European Banking Supervisors’ summary report:
Government support measures received by institutions in the sample as of end 2009 have been taken into account and subject to specific analysis (see Section 4.5 of the report).
Stress Test Special – Markets Live at 4.45BST
If you’re thinking it’s an odd time to be holding a special session of our regular Markets Live chat, well that’s the Committee of European Banking Supervisors for you. It has chosen the close of play in Europe on a Friday as the perfect time to formally release the results of the European bank stress tests.
Markets stress out over stress tests (updated)
There was a last-minute outbreak of nerves in Europe over stress-test credibility on Friday, after Meera Louis of Bloomberg revealed that banks will only be stressed for their exposure to sovereign debt on their trading books,
Market gives banks a ‘B’ ahead of the stress tests
In case you were wondering about market expectations ahead of the stress tests.
The below has just landed in our inbox. It’s the results of a Goldman Sachs survey of 376 mostly-European market “participants”
A CDStress test game
Here’s a fun game for Friday courtesy of Markit.
It’s a list of current CDS levels in the European banks being stress-tested.
Now click to enlarge — and spot the odd ones out:
So how did the stress test go, Atebank?
Although it’s not just Greek banks in focus — El Pais is reporting caja failures too.