EBA Says Bank Recapitalization Timetable Stands
Europe's banking regulator said there were no plans to force more than a dozen weaker mid-tier banks to raise capital more quickly, saying an original timetable remained in place.
Late Thursday, the Financial Times, citing officials, reported that European regulators look set to speed up plans to recapitalize 16 banks that came close to failing this year's pan-EU stress tests.
The EBA said a call from super-watchdog the European Systemic Risk Board on Wednesday for coordinated action to strengthen the capital position of banks chimed with the recommendation issued by the EBA in July after the stress test.
"The time frame for assessing these actions and monitoring their implementation is also in the recommendation. There are no changes to that time line," a spokeswoman for the EBA said.
Nine banks failed the EBA test and were told to raise more capital by the end of December.
The EBA also said banks that only narrowly passed the stress test -- with a capital ratio of just above 5 percent after a two-year recession scenario -- and with significant exposure to sovereign debt in troubled euro zone countries should take action to strengthen their capital positions.
The banks must tell their national supervisors by the end of October what steps they will take to beef up capital.
The EBA will assess those steps and monitor implementation, which has to be completed by end of April 2012, and will publish a report on what has been done.
The "near pass" banks are mostly mid-tier lenders. Seven are Spanish, two each are from Germany, Greece and Portugal, and there is one each from Italy, Cyprus and Slovenia.
The list includes Germany's HSH Nordbank and Banco Popolare of Italy.
(Reporting by Steve Slater, Huw Jones, Chris Sanders and Burton Frierson; editing by James Dalgleish and Andre Grenon)
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