• Sweden's news in English

Swedish banks pass ECB financial health test

AFP/The Local · 26 Oct 2014, 14:28

Published: 26 Oct 2014 14:28 GMT+01:00

Facebook Twitter Google+ reddit

Nearly one in five banks subjected to a crunch financial health check by the European Central Bank have failed the test, though no major banks were among them, according to official data on Sunday.

The Swedish Financial Supervisory Authority (Finansinspektionen - Fi) meanwhile conducted the test on Swedish banks Handelsbanken, Nordea, SEB and Swedbank who all made it.

"They still have decent margins," said Uldis Cerps at Fi.

Cerps warned however that the Swedish banks could however still be affected by how the ECB audit, which was aimed at preventing a recurrence of the single currency area's debilitating financial crisis, is received.

"If the stress test results in disruption in financial markets, then the Swedish banks will be affected," Cerps said.

The goal to avoid a repeat of the financial turbulence that followed the finance crunch in 2008, has become even more important in recent weeks, as the eurozone is seen to be again tottering on the edge of recession. There are rising fears of deflation and economic growth in key states France and Italy is stalling.

Even Germany, which had been doing well with exports, is looking at slowing growth on the back of weak investment.

"This unprecedented in-depth review of the largest banks' positions will boost public confidence in the banking sector," said ECB vice president Vitor Constancio.

He added that "this should facilitate more lending in Europe, which will help economic growth".

A total 25 of the 130 banks flunked the audit, the ECB said, adding that the worst results were concentrated in Italy, where some nine banks failed, as well as three in Greece and three in Cyprus.

The banks showed a combined capital shortfall of €25 billion (about $31 billion) as at the end of 2013.

Story continues below…

Twelve of the 25 failing banks however have already covered their capital shortfalls this year, raising their capital by 15 billion euros, the ECB said.

Banks with shortfalls must prepare capital plans within two weeks and have up to nine months to cover the capital gaps.

As part of the audit, the ECB reviewed the quality of bank assets to make sure they were properly valued.

It also identified €136 billion in troubled assets, known as non-performing loans.

For more news from Sweden, join us on Facebook and Twitter.

AFP/The Local (news@thelocal.se)

Facebook Twitter Google+ reddit

Your comments about this article

Today's headlines
Here's how slow Sweden's high-speed trains are getting
A Swedish SJX2000 high speed train. Photo: Tomas Oneborg/SvD/TT

The high-speed rail journey between the three biggest Swedish cities is about to get longer.

The Local List
12 Swedish words with just awesome literal translations
A filthy-minded lobster, i.e. a snuskhummer. Photo: Gorm Kallestad/NTB scanpix/TT

One of our favourite things about the Swedish language is its wonderful compound words, which range from being utterly bizarre to making perfect sense.

US election
Donald Trump won't get new Ericsson head's vote
Trump pictured at a campaign rally in Florida. Photo: Evan Vucci/AP

The new Swedish-American boss of telecoms giant Ericsson has revealed he will not vote for the Republican nominee in the forthcoming US presidential election.

Swedes named fourth most gender equal in the world
A file photo of men and women pushing prams in Stockholm. Photo: Claudio Bresciani/TT

Sweden has closed 81 percent of its overall gender gap according to the World Economic Forum.

Sweden: Russian warships in the Baltic 'worrying'
Swedish Defence Minister Peter Hultqvist. Photo: Vilhelm Stokstad/TT

Two Russian warships equipped with long-range missiles have entered the Baltic Sea after passing Denmark.

Why businesses are worried about Sweden's drone ban
A drone filming in Stockholm. Photo: Pontus Lundahl/TT

The Local investigates what Sweden's new drone ban could mean for businesses in the country.

This is the new top boss of Swedish Ericsson
Börje Ekholm. Photo: Magnus Hjalmarson Neideman/SvD/TT

Telecoms giant Ericsson has appointed a new CEO after a turbulent year for the company.

These are Sweden's best universities: ranking
A new university ranking has been released. Photo: Cecilia Larsson Lantz/Imagebank.sweden.se

At least according to this global ranking, which picks 12 Swedish universities among the top-1000.

Swedish pharmacies restrict paracetamol sales for teens
The move is intended to cut paracetamol overdoses. Photo: Nora Lorek/TT

Sweden's pharmacies are banning teens under 18 from buying more than one pack of pills at a time.

Rwandan genocide suspect held in Sweden
A memorial centre in Kigali, Rwanda. Photo: Ben Curtis/AP

A man has been arrested in Sweden suspected of involvement in the 1994 Rwandan genocide which claimed 800,000 lives.

Sponsored Article
Stockholm: creating solutions to global challenges
Sweden cuts 2016 refugee forecast
Sponsored Article
Last chance to vote absentee in the US elections
Is Game of Thrones coming to Sweden?
Property of the week: Kungsholmen, Stockholm
Blog updates

6 October

10 useful hjälpverb (The Swedish Teacher) »

"Hej! I think the so-called “hjalpverb” (auxiliary verbs in English) are a good way to get…" READ »


8 July

Editor’s blog, July 8th (The Local Sweden) »

"Hej readers, It has, as always, been a bizarre, serious and hilarious week in Sweden. You…" READ »

Sponsored Article
This is Malmö: Football capital of Sweden
Will Swedes soon be looking for fairtrade porn?
Sponsored Article
Where is the Swedish music industry heading?
The Local Voices
'I simply don’t believe in nationality'
Why we're convinced Game of Thrones is based on Sweden
People-watching: October 21st-23rd
Sponsored Article
Why you should 'grab a chair' on Stockholm's tech scene
Fury at plans that 'threaten the IB's survival' in Sweden
Sponsored Article
Swedish for programmers: 'It changed my life'
Analysis & Opinion
Are we just going to let half the country die?
Angry elk chases Swede up a lamp post
Sponsored Article
Top 7 tips to help you learn Swedish
The Local Voices
'Alienation in Sweden feels better: I find myself a stranger among scores of aliens'
Sponsored Article
‘Extremism can't be defeated on the battlefield alone’
People-watching: October 20th
The Local Voices
A layover at Qatar airport brought this Swedish-Kenyan couple together - now they're heading for marriage
Sponsored Article
Stockholm: creating solutions to global challenges
Swede punches clown that scared his grandmother
Sponsored Article
Why you should 'grab a chair' on Stockholm's tech scene
Fans throw flares and enter pitch in Swedish football riot
Sponsored Article
Where is the Swedish music industry heading?
Could Swedish blood test solve 'Making a Murderer'?
Sponsored Article
One expat's strategy for making friends in Stockholm
Swedish school to build gender neutral changing room
Sponsored Article
Nordic fashion in focus at Stockholm University
People-watching: October 14th-16th
Man in Sweden assaulted by clowns with broken bottle
Nobel Prize 2016: Literature
Watch the man who discovered Bob Dylan react to his Nobel Prize win
Record numbers emigrating from Sweden
People-watching: October 12th
The Local Voices
'Swedish startups should embrace newcomers' talents - there's nothing to fear'
How far right are the Sweden Democrats?
Property of the week: Triangeln, Malmö
The Local Voices
Syria's White Helmets: The Nobel Peace Prize would have meant a lot, but pulling a child from rubble is the greatest reward
jobs available