Seven of 91 European banks have failed stress tests and show an overall capital shortfall of 3.5 billion euros, the organizers of the tests said on Friday.

Following are comments from policymakers and analysts on the results.

MARK O'SULLIVAN, DIRECTOR OF DEALING AT CURRENCIES DIRECT

I just think it's a political mish-mash, a bit of a compromise. People will think that the threshold to pass was set too low.

ION-MARC VALAHU, GENEVA-BASED INDEPENDENT TRADER

If you're not accounting for the trading book, you're not showing the full picture.

FRANCOIS SAVARY, CHIEF INVESTMENT OFFICER AT REYL

These are tests which are not really that significant. They do not appear to be factoring in the risk of a sovereign default, which slightly reduces the quality of the test.

HUGH JOHNSON, CHIEF INVESTMENT OFFICER, HUGH JOHNSON ADVISORS LLC, ALBANY, NY

It's not significant. There is some question amongst those that are looking at it as to whether they made it too lenient. The real question is how tough were the stress tests, and there is reason to believe they were not tough enough. This is, to some extent, comforting, but the test was not as rigorous as it might have been.

IAN STANNARD, SENIOR CURRENCY STRATEGIST, BNP PARIBAS:

The initial reaction so far suggests the tests were not as stringent as they could have been, and the market remains slightly cautious. We'll get a real reaction next week when the results are fully digested and we get a clearer picture.

It's more a case of the methodology and the assumption for these tests, and these were not the most stringent that could have been and there are some questions over that, which is why we saw the euro fall earlier.

JAMES HUGHES, MARKET ANALYST AT CMC MARKETS IN LONDON

It was too lenient. We were expecting 10 banks to have failed but only seven failed. No listed banks failed. It hasn't allayed any of the fears that were there, and all the questions that were being asked before are still going to be asked.

GERMAN FINANCE MINISTER WOLFGANG SCHAEUBLE

The broad participation in the stress tests and the publication of results is an important step for more confidence on markets. This has increased the transparency about the resilience of European banks.

It is a positive sign that all participating German banks without exception fulfill the supervisory requirements even in the unlikely scenario of a serious collapse in growth.

Upon assessing the results, it is important to note that in the special case of HRE, the stress test was not able to take into account the restructuring process that has already been launched.

Despite the generally pleasing results of the stress tests, it is still necessary to achieve further progress in the consolidation of the Landesbanken sector.

BANK OF FRANCE GOVERNOR AND EUROPEAN CENTRAL BANK GOVERNING COUNCIL MEMBER CHRISTIAN NOYER

The hypothesis of a (sovereign) default is excluded because the European states, especially in the Eurozone, have put several hundreds of billions of euros on the table with the support of the IMF to make this hypothesis completely excluded.

This exercise is much heavier and more ambitious than the U.S. exercise which focused on only twenty some banks. This one involves two thirds of the European banking assets (and 80 percent in France). It is a very representative sample.

THOMAS NAGEL, TRADER AT EQUINET, FRANKFURT:

The results came in as expected so that box can be ticked. However, I wouldn't be surprised if there will be some voices in the market in a couple of minutes that point to the lack of credibility of the tests.

VASSILI SEREBRIAKOV, CURRENCY STRATEGIST, WELLS FARGO BANK, NEW YORK

There's no major surprise so far in the results of the tests. Most of the institutions that failed, were expected to do so. Details of the tests still need to be scrutinized but the issue remains whether the tests were too soft on European banks. But it is too soon to determine that at this point.

Still, there's nothing in these reports that is a true positive and really supportive to the euro.

BULENT BAYGUN, HEAD OF U.S. INTEREST RATE STRATEGY AT BNP PARIBAS IN NEW YORK

Rates backed up by a couple of basis points immediately but given that a lot have passed the general sense is 'is this something credible?' really. So I'm not sure if there is going to be follow-through to the rate backup.

If equities begin to react negatively to this as something that is not quite credible...that's going to bring down Treasury rates also.

There are some that are failing but for the most part it looks like all the banks appear to be healthy based on this test.

CARY LEAHEY, ECONOMIST, DECISION ECONOMICS, NEW YORK:

The market expectation was that you were going to have about 10 bank failures -- two from Germany, one from Greece and about six from Spain -- and capital shortfalls totaling at least 100 billion euros. Final results of fewer than six failures would have been worse for the market than twelve failures because six failures would lack credibility in the market. It's better to have people believe that the tests have been too tough rather than too easy. The bond market started reacting when it appeared the tests would just be on banks' trading books, not their full books, and that they would not roll in the possibility of a sovereign default.

Germany BNP Paribas Investment