FRANKFURT - September 91 of Europe's biggest banks would struggle to survive an unexpected fall in economic growth or a marked deterioration in the value of European government bonds, and should raise more capital, regulators, has said Friday the publication of results of stress tests followed closely banking. 
The banks were to fail Hypo Real Estate, a Munich-based bank that is already owned by the government after a rescue ATEBank of Greece and five Spanish savings banks.
Several other banks passed the test, but only just enough that they may also feel the market pressure to increase their reserves. The group included Postbank, one of the largest publicly traded banks in Germany which is 25 percent owned by Deutsche Bank.
Governments of affected countries, or the banks themselves said that they were ready with measures to raise more money for the banks whose reserves were considered too small to withstand the most pessimistic outlook.
After months of turmoil caused by the crisis of sovereign debt of Europe and its effects on the banking system, governments and investors were looking to test to see if Europe could show that finally confront problems and deal head-on. If tests are successful in restoring confidence depends on whether investors and analysts said they were serious enough to expose the banks vulnerable.
"The more stringent best for the euro," said Adam Cole, global head of foreign exchange strategy at RBC Capital Markets.
Nicolas Veron, a visiting scholar at the Peterson Institute for International Economics in Washington, called the level of detail published "disappointing".
"Investors can not reverse the results and apply their own assumptions," he said.
bank supervisors and central banks insisted that the tests have been rigorous and that fears about the stability of European banks have been exaggerated.
"This is a test very seriously," Franz-Christoph Zeitler, a member of the Executive Board of the Bundesbank, the German central bank, said at a news conference in Frankfurt. "All this criticism is absolutely premature."
Stress tests, conducted an exercise similar to the U.S. last year, was intended to restore confidence in financial institutions in Europe was shaken by the crisis of sovereign debt. The uncertainty about which banks may be sitting on piles of debt and other assets Greek potentially toxic has made institutions reluctant to lend to each other and to enterprises, and has acted as a brake on economic growth.
Some banks have already decided to increase the capital ahead of the results. National Bank of Greece, who took the test, announced Friday it has sold € 450 million, or 580 million dollars of bonds from 10 years to strengthen its regulatory capital. "The sale process was concluded within four days, which reflects the confidence the investment community in NBG," said the lender.
Banca Civic, the merger of three smaller savings banks in Spain, has failed the test. But he said before the results he had signed an agreement with JCFlowers, a firm takeover of the United States, to place € 450 million in convertible bonds.
Hypo Real Estate said the stress test had "limited value" because it was already in the process of transfer of distressed assets to a so-called bad bank underwritten by the German government. http://jodnet.blogspot.com
Miguel Angel Fernandez Ordonez, Governor of the Bank of Spain, during a news conference the stress test results justified the recent surge in force savings or Cajas, consolidate, and the regulatory review opening their capital for more investment.
The tests were proof of "the enormous resources" to the Spanish banking sector to overcome a crisis, "he said. "When there are doubts, you must be absolutely transparent, and that's what we did."
In addition to Banca Civic, four other unlisted Spanish savings banks failed: Diada, Unnim, Espiga and CajaSur, which was bailed out by the Bank of Spain in May
In a blow to the credibility of potential tests, the regulators did not consider whether the banks could withstand default of debt by Greece or any other European country. European authorities - unlike many economists - consider such a possibility unthinkable.
In a compromise, the banks were scheduled to detail their holdings in Greek, Spanish, Portuguese and other bonds. But a report published by European banking supervisors did not contain this information, which would remove the intense speculation about which banks are most exposed.
To pass the test, a level of bank capital, a measure of reserve, was not to fall below 6 per cent of the assets in the face of a new recession and a crisis of sovereign debt.
Authorities across Europe have been clearly nervous about the market's reaction to the tests and delayed the publication of results until after European stock markets closed. Trading was fairly stable on Friday although bank shares fell.
Germany nine regional banks in the public sector have all passed - a result that might encourage skepticism about whether the criteria were quite hard. Many analysts regarding regional banks controlled by the state which has suffered losses of billions of subprime assets and other investments unwise as too susceptible to political influence and without a strategy to be fully consistently profitable.
Norddeutsche Landesbank, Hanover-based, narrowly passed, but Mr. Zeitler said he would not need to raise new capital.
The authorities argued that, unlike stress tests in the United States last year, European trials came after a huge rescue effort in which the EU countries staked more than one quarter of gross domestic product block domestic product to prevent regional banks and other troubled institutions fail. Therefore, the authorities said, the relatively high success rate is justified. In the United States, 10 of the 19 banks tested were informed that they would raise a total of 75 billion dollars of new capital.
The four main French banks, representing 80 percent of banking assets in the country, all passed easily. "These results show that they are able to ensure sound financing of the economy in both the scenario and the scenario very stressed," said Christian Noyer, governor of the Bank of France.
coming days will reveal whether the tests will end the mistrust of banks from each other credit and to encourage interbank lending, which is essential for the normal functioning of the financial system and ultimately the global economy. In May, currency markets nearly froze Greek bond prices fell, prompting the authorities to take extraordinary measures to prevent a crisis that could threaten the solvency of some banks.
On 10 May, U.S. officials and the International Monetary Fund pledged € 750 billion or nearly one billion dollars in order to guarantee the sovereign debt of countries. The European Central Bank has also started buying the Greek government and other companies and debt markets opened for trading in the restoration of sovereign paper, an unprecedented decision that caused dissent within the bank.
The E.C.B. is keen to wean institutions outside of almost unlimited cheap loans he has provided since the beginning of the financial crisis but may do so if the banks resume lending to each other.
In a second round in two weeks, tests will be extended to subsidiaries of banks, as institutions belonging to the Eastern banks based in Vienna.
Stress tests were the largest ever conducted in Europe, covering 65 percent of total banking market and 20 countries from Ireland to Poland. Regulators have nearly tripled the number of participating banks in part because of prodding from the U.S. treasury secretary, Timothy F. Geithner, who had expressed concern that European authorities have not had the crisis of sovereign debt under control.
Disclosure of test results was also unprecedented, and came only after lengthy negotiations with banks, which in Germany and other countries could not legally be compelled to disclose the data. stress test earlier periods covered banks much less, and authorities have released only general information on the results.
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