Industry Sector Weekly by Lloyds TSB

Of the 91 banks tested under an adverse scenario, including a sovereign credit shock, only seven failed to meet the 6% tier 1 capital ratio threshold. All UK banks exceeded this threshold with over 3% headroom. Focus on EU bank stress tests

Of the 91 banks tested under an adverse scenario, including a sovereign credit shock, only seven failed to meet the 6% tier 1 capital ratio threshold. All UK banks exceeded this threshold with over 3% headroom. As largely anticipated, those banks that failed to meet the 6% threshold included five Spanish cajas, Germany’s HRE and Greece’s ATE. The aggregate capital shortfall faced by these banks is estimated at €3.5bn. The surprise was perhaps that all German landesbanks passed the tests.