Thursday April 17, 2014 Search
Weather | Athens
19o C
12o C
News
Business
Comment
Life
Sports
Community
Survival Guide
Greek Edition
Three obstacles left on road to completion of lenders’ stress tests

By Yiannis Papadoyiannis

The results of the credit sector’s stress tests conducted by the Bank of Greece and BlackRock Solutions are expected by the end of the month, provided negotiations with the country’s creditors on the issue are completed.

The new law on the share capital increase of the systemic banks will follow, but Finance Ministry sources tell Kathimerini that there needs to be at least a sense of the level of the funds required before the new framework for the capital increases of the banks is set in stone.

However, according to all indications, the distance between the government and its creditors on the credit system is large enough to have forced the delay to the publication of the results, originally scheduled for end-December.

For the completion of the stress tests there needs to be agreement on three key points. The first concerns the threshold of the capital adequacy index that Greek banks must reach in order to pass the exercise successfully. Greek authorities want the capital adequacy threshold at 8 percent, as is the European Central Bank’s Core Tier 1 index threshold. Greek banks currently have to reach a 9 percent reading. Furthermore, in the adverse scenario of the exercise, Greece wishes to have a 6 percent index threshold, the same as for the rest of the eurozone, against the 7 percent level used in the previous BlackRock stress test.

The second point concerns the handling of deferred tax assets, which the Bank of Greece recently acknowledged in its entirety as part of the banks’ assets, compared with just 20 percent up until a few days ago. However, many analysts consider the incorporation of 100 percent of the deferred tax assets in the stress test results particularly difficult due to the Basel III rules, dictating that deferred tax cannot exceed 10 percent of Tier 1 capital.

The last point is whether the basic or the negative scenario will be used to determine the capital requirements of banks, as in case that the negative scenario is chosen, it won’t just be Eurobank that may need additional funds. It will all boil down to whether the government is able to tap the 9 billion euros in unused funds from the recapitalization process, or if will have to leave it as a safety buffer for future needs.

ekathimerini.com , Monday Jan 20, 2014 (22:43)  
Euro award institutions choose Greece
Mission to woo Russian visitors
IOBE: Reforms are the only way for economy to return to growth
Piraeus steals show as stock index recovers
Judges warn GD holdups over lifting of immunity could lead to suspects´ release
The magistrates handling the investigation into the neo-Nazi Golden Dawn party’s alleged illegal activities warned Parliament Wednesday that some of the suspects in the case could be release...
Tensions in SYRIZA as EP election list finalized
Leftist opposition SYRIZA on Wednesday announced another six of its candidates for next month’s European Parliament elections, following a stormy session of the party’s political secretariat...
Inside News
SOCCER
Greek soccer turns fishier than ever
Soccer in Greece reached new lows in scenes unseen since the national team’s triumph in Euro 2004, as PAOK and Olympiakos served up a cup semifinal with PAOK emerging as the winner and the s...
BASKETBALL
Greens within a whisker of upsetting CSKA Moscow
Panathinaikos came mighty close to snatching home advantage from CSKA Moscow in Game 1 of the Euroleague play-offs on Wednesday, but eventually succumbed to its host in Russia in overtime, w...
Inside Sports
COMMENTARY
Stopping the madness
Greek society is threatened by an overdose of madness and hatred. To be sure, behind the rise of polarization and of extreme – sometimes extremist – views is the harsh reality of the debt cr...
EDITORIAL
Fundamental contradictions
The deep division running through the ranks of the country’s main opposition party regarding the euro and how Greece’s negotiations with its partners and creditors ought to be carried out is...
Inside Comment
SPONSORED LINK: FinanzNachrichten.de
SPONSORED LINK: BestPrice.gr
 RECENT NEWS
1. Greek soccer turns fishier than ever
2. Greens within a whisker of upsetting CSKA Moscow
3. Euro award institutions choose Greece
4. Mission to woo Russian visitors
5. IOBE: Reforms are the only way for economy to return to growth
6. Piraeus steals show as stock index recovers
more news
Today
This Week
1. EU struggles to unpick the knot of Russia-Ukraine gas logistics
2. Stormy weather expected in northwest, central Greece
3. Greece to assist search for remains of Turkish pilot
4. Illegally claimed pensions cost state over 12.5 million euros
5. Bad weather leaves northwest town powerless
6. University admission exams to commence May 28
Today
This Week
1. Bomb explodes outside Bank of Greece
2. Time to take a hard look at debt sustainability, says OECD chief
3. For faith and country
4. CCTV footage from Nigrita Prison shows signs of inmate torture [Video]
5. Samaras sees no need for third bailout
6. Car bomb explodes outside Greek Central Bank building, no one hurt [Update]
   Find us ...
  ... on
Twitter
     ... on Facebook   
About us  |  Subscriptions  |  Advertising  |  Contact us  |  Athens Plus  |  RSS  |   
Copyright © 2014, H KAΘHMEPINH All Rights Reserved.