FRANKFURT – The European Central Bank says 13 of Europe’s 130 biggest banks have flunked an in-depth review of their finances and must increase their capital buffers against losses by 10 billion euros ($12.5 billion).
The ECB said 25 banks in all were found to need stronger buffers – but that 12 have already made up their shortfall.
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The remaining 13 now have two weeks to tell the ECB how they plan to increase their capital buffers.
The ECB checked the worth of bank holdings and subjected banks to a stress test that simulates how their finances would fare in an economic downturn. The exercise is aimed at strengthening the banking system so it can provide more credit to companies and boost the weak European economy.
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