European authorities are performing a third stress test on the Spanish banking system. Last week several cajas and banks had to submit additional information in order demonstrate that they meet current financial stress requirements. Analysts predict that the results will be published between July 8 and July 15, as soon as the European Banking Authority finalizes the assessment method and receives all the data they need to perform the tests.
Most of the banks and cajas don´t understand the EBA´s attitude, considering that they follow the Bank of Spain´s criteria for calculating net asset worth. Further, they believe these difficult tests are like a witch hunt aimed at upending confidence in the markets.
Complaints have already been passed on to the Bank of Spain to judge whether there has been discrimination.
Ten days ago the main lobby for the cajas sent a letter to the Bank of Spain, relating its disagreement with the measures adopted by the EBA and demanding more pressure on Europe to include a buffer against insolvency. Another bank also sent a long and pointed letter.
Fear within the cajas and banks is rooted in how the markets will interpret the stress tests, considering that the first line of the results will clearly indicate how the institutions have failed the tests.
And it has to be said that the entire Spanish system is confronting these tests at the government´s insistence and desire of the Bank of Spain to improve transparency during moments of instability.
Translated and Edited in English by Brandon Dyches and Jose L. De Haro
