EU Bank Regulators Plan Stress Tests to Examine Risks

European Union bank regulators will conduct confidential stress tests by September, stepping up scrutiny of risks after lenders absorbed more than $1 trillion of losses and writedowns in the global financial crisis.

Regulators in the 27 countries will privately report industry data to finance ministers and the EU’s executive agency, the Committee of European Banking Supervisors in London said. Results for individual lenders such as Commerzbank AG or Barclays Plc won’t be released.

The tests, the second devised by CEBS this year, seek to assess risks in the market, rather than determine capital needs, in contrast to the U.S. program completed last week. Still, authorities may order banks to top up capital as a result, adding to $412.5 billion raised by financial companies in the region during the crisis.  Read more about the European stress tests…