Stress test results will be better than expected
The results of the European Central Bank’s health check on Greece’s four big banks, which will be released on Saturday, will be better than expected, a Bank of Greece official said yesterday. “[The capital shortfalls] will be below the limits of what was expected,” the official said, declining to be named. European Union Commission Vice President Valdis Dombrovskis said yesterday that Greece needs to have its biggest lenders recapitalized by the end of the year. “We all agree to finalize bank recapitalization by end of this year,” Dombrovskis said after meeting Greece’s Central Bank Governor Yannis Stournaras. Dombrovskis was in Athens for talks on reforms Greece needs to complete before a review which would unlock new aid for the country under an 86-billion-euro bailout. The ECB conducted an asset quality review and a stress test on National Bank, Piraeus Bank, Eurobank and Alpha Bank under baseline and adverse scenarios on the future course of the economy and projected credit losses. Under the deal, Greece is set to receive up to 25 billion euros of international money to recapitalize its banks, three of which are majority-owned by Greece’s bank bailout fund HFSF.