German Banks Fear Stress-Test Failure

German banks have expressed concern that they may fail the next round of stress testing because of stringent capital standards the European Banking Authority may use, reports The New York Times.

German banks have expressed concern that they may fail the next round of stress testing because of stringent capital standards the European Banking Authority may use. The EBA is expected to release in the next few days what capital may be counted toward the reserve requirement, and the German banks fear that much of the borrowed capital they currently use could be excluded, and thus force them to raise billions in fresh funds.

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