16 European Bank Recapitalization Accelerated

Written By JSap on Jumat, 23 September 2011 | 01.06

Countries in Europe plans to accelerate the recapitalization of 16 banks are expected to fall according to the results of stress tests conducted by a team from the European Union. Efforts were also part of the coordination in order to force banks in 27 EU member states.

A senior French official told the Financial Times said shareholders of 16 banks were ordered to immediately increase the company's capital.

Bank recapitalization effort is expected to hit the medium-sized banks in the EU. A total of seven banks in Spain, while Germany, Greece, and Portugal each of the two banks, and the remainder from a bank in Italy, Cyprus, and Slovenia.

In the list of 16 banks that will be exposed to recapitalize including HSH Nordbank of Germany, and Banco Popolare of Italy.

Meanwhile, 14 other European banks are Espirito Santo and Banco Portugues of Portugal, Piraeus Bank and Hellenic Postbank from Greece, as well as Banco Popular, Bankinter, Caixa Galicia, BFA-Bankia, Banco Civica, Caixa Ontinyent, and Banco de Sabadell of Spain.

In addition, the Nova Ljubljanska Banka from Slovenia, Cyprus's Marfin Popular Bank of Cyprus, and Norddeutsche Landesbank of Germany.

Head of the European Union's Internal Market Commission or the EU Internal Market Commissioner, Michael Barner, assessing the nearly 16 banks failed in the stress test and was sentenced to be vulnerable and should be strengthened in the future.

"We want this bank recapitalization efforts undertaken by the private sector. Era injection of funds (bailout) for banks to be terminated. Although I can not deny, there is the possibility of the banks that need government assistance," he said.

When the Authority or the European Banking European Banking Authority (EBA) to test the scenario of economic threats against 91 banks, nine banks had failed and ordered to increase their capital until the end of December 2011.

A total of 16 banks who were in the spotlight of the European Union has a tier-one capital ratio of about 5-6 percent. This ratio indicates the strength of corporate finance. EBA has given the company until April 2012 for companies to implement a plan to raise their capital reserves.

For information, the International Monetary Fund (IMF) some time ago had suggested that immediate efforts to recapitalize European banks in an effort to prevent the spread of debt crisis that hit Greece. (Art)
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