The European Central Bank (ECB) and the European Banking Authority (EBA) have published the results of the latest stress tests and asset quality reviews (AQR).  As foreshadowed from the outset, a number of institutions did not pass the ‘unique and rigorous’ tests, which were designed to be more severe than in previous EU exercises.

The EBA has published the aggregate and individual results of the 2014 EU-wide stress tests of 123 banks, which combined both micro-prudential and macro-prudential aspects. Over the three-year horizon of the exercise, the results showed that 24 banks would fall below the 5.5% Common Equity Tier 1 (CET1) ratio threshold and the overall shortfall would total €24.6 billion.

The ECB has also published its aggregate report on the comprehensive assessment of the 130 largest euro area banks.  The ECB’s assessment found a capital shortfall of €24.6 billion at 25 banks.  The ECB has also published the transcript of the comprehensive assessment press conference (with Q&A) and the presentation slides from the press conference.

For a more detailed summary, click here.