25 Banks Which Failed ECB Test

28 October 2014

In October 2014 European Central Bank conducted an assessment of 130 major European banks from 19 countries (all the Euroarea countries and Lithuania as it's going to join the Euroarea from 1 January 2015). The goal of the assessment was to identify the banks having currently capital shortfall and the banks that may have capital shortfall in the next two years based on different projection scenarios.

The assessment consisted of two parts: asset quality review (AQR) and stress test.

The asset quality review was performed to indicate of the need for additional provisions for losses on exposures on banks' balance sheets: based on the asset quality review capital ratios were calculated to allow the meaningful comparison of all participating banks.

The stress test was conducted to examine the resilience of banks against two separate scenarios in the next two years, 2014-2016. The baseline scenario reflected official macroeconomic forecasts while the adverse scenario represented a severe economic downturn.

Common Equity Tier 1 (CET1) was the main metric used for the assessment. In order to pass the assessment, a bank was required to meet all of the criteria listed below:

List of Banks That Failed The Assessment

Of out 130 assessed banks from 19 countries, 25 banks from 11 countries failed the assessment. The list of the banks failed the assessment is shown in the table below.

Banca Monte dei Paschi di Siena S.p.a.Italy
National Bank of GreeceGreece
Banca Carige S.p.a. - Cassa di Risparmio di Genova e Imperia Italy
Cyprus Cooperative Bank LtdCyprus
Banco Comercial PortuguêsPortugal
Bank of CyprusCyprus
Österreichische Volksbanken-AGAustria
permanent tsb plcIreland
Veneto Banca S.p.a. In Liquidazione Coatta AmministrativaItaly
Banco Popolare - SCItaly
Banca Popolare di Milano ScrlItaly
Banca Popolare di Vicenza Spa In Liquidazione Coatta AmministrativaItaly
Piraeus BankGreece
Banca Piccolo Credito Valtellinese, SpAItaly
Banca Popolare di Sondrio, SCpAItaly
Hellenic Bank Public Company LtdCyprus
Münchener Hypothekenbank eGGermany
C.R.H. - Caisse de Refinancement de l’HabitatFrance
Bper Banca S.p.a.Italy
Liberbank, S.A.Spain

Assessment's Results by Country

The table below shows the assessment results grouped by country: for each of the countries, the total number of the assessed banks and the number of banks failed the assessment are provided.

The worst results have been shown in Italy (9 banks failed the test of 15 assessed banks), Cyprus (3 failed of 4 banks), Greece (3 failed of 4 banks) and Slovenia (2 failed of 3 banks).

In 8 countries all the assessed banks passed the test.

Country Number of Assessed Banks Number of Failed Banks
AT Austria 6 1
BE Belgium 6 1
CY Cyprus 4 3
DE Germany 25 1
EE Estonia 3 0
ES Spain 15 1
FI Finland 3 0
FR France 13 1
GR Greece 4 3
IE Ireland 5 1
IT Italy 15 9
LT Lithuania 3 0
LU Luxembourg 6 0
LV Latvia 3 0
MT Malta 3 0
NL Netherlands 7 0
PT Portugal 3 1
SI Slovenia 3 2
SK Slovakia 3 0


The only bank that failed the assessment was Österreichische Volksbanken-AG. Its CTE1 ratios for both baseline and adverse scenarios in 2016 were below the threshold vaules (7.2% and 2.1%).


The only bank that failed the assessment was AXA BANK BELGIUM. Its CTE1 ratio for adverse scenarios in 2016 was 3.4%.


Out of 4 banks that have been assessed, 3 failed the test. The only bank that passed the test was RCB Bank Ltd.


Out of 25 banks that have been assessed, only 1 failed the test: Münchener Hypothekenbank eG.


Out of 15 banks that have been assessed, only 1 failed the test: Liberbank, S.A.. The only value that was slightly below the threshold was CTE1 ratio based on asset quality review (7.8% instead of 8.0%)


In France 13 banks that have been assessed, and only 1 failed: C.R.H. - Caisse de refinancement de l'habitat. While the CTE1 ratios for the adverse scenario were above the threshold of 5.5%, the ratios for the baseline scenario were below the threshold.


Out of 4 banks that have been assessed, 3 failed the test. The only bank that passed the test was Alpha Bank.


In Ireland out of 5 banks only permanent tsb plc didn't passed the test failing to reach the threshold values for the adverse scenario.


9 out of 15 banks failed to pass the test in Italy.


In Portugal out of 3 banks 1 bank failed the test: BANCO COMERCIAL PORTUGUÊS, SA didn't reach the threshold values for the adverse scenario in 2015-2016.


In Slovenia out of 3 banks 2 bank failed the test: they didn't reach the threshold values for the adverse scenario in 2015-2016. The third bank, however, passed the test reaching the values far above the thresholds (SID-SLOVENSKA IZVOZNA IN RAZVOJNA BANKA, d.d., LJUBLJANA).

All Banks Passed Test Assessment

All the banks passed the assessment in the following countries: