This European Banking Authority (EBA) banks this year harder stress test Given the current “macroeconomic scenario”, uncertain and changingThe organization, headquartered in Paris, thus, eighth edition Of these tests, which measure the ability of European institutions to withstand the sudden and marked deterioration of economic conditions. In Spain, it will affect Abanca, BBVA, Sabadell, Santander, Bankinter, CaixaBank, KutxaBank and Unicaja Banco.
Like this Adverse scenario (which is highly unlikely), the European economy will shrink by 6% by 2025 (compared to 3.6% in 2021 and 2.7% in 2018), unemployment will double to 12.2%, bags will lose 43% of its values, long-term market interest rates will increase by 1.83 points, inflation will rise to 9.7% this year and will remain high at 4.5% in two years and housing prices will decrease to approximately 21% over the three-year period.
EBA conducts these tests of European banks’ resistance level since 2009, initially annually and then biennially. exercise was done controversial In many cases because of the results achieved by organizations like Banco Popular that need to be intervened or restructured later. To try to clear these doubts, the body headed by José Manuel CampaThe European Systemic Risk Board and the European Central Bank (ECB) went hardening test print on print.
This is a very relevant exam for the banking industry. Officially, it’s not a test that can be done. pass or fail (Since the 2016 edition, there is no minimum level of capital required in the adverse scenario). However, the area ECB audit considers results and can request and impose internal changes from organizations higher solvency levels. In addition investors they tend to focus their attention on the worst performing banks and therefore market pressure to clear and capitalize their balance sheets.
The negative scenario has been “intentionally” chosen to include “high inflation and higher interest rates, and hypothetically increasing geopolitical tensions”. negative effects on private consumption and both national and global investments”. The results of the test will be published at the end of July. On this occasion, the affected banks will be 75 more than the European Union and Norway, 20 more than the 2021 edition, and they represent 75% of the total EU banking assets, up from 70% two years ago. will cover it.
Source: Informacion
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