* "Credit Suisse": At least 66 European banks would not pass new stress tests
The European Central Bank (BCE) yesterday warned again that any form of reduction of a country"s debt, which forces the private sector to take on losses, might affect the Euro, and the banks in the region, respectively.
The ECB officials say: "The non-voluntary involvement of the private sector might affect the international reputation of the single currency, and could increase volatility on the currency markets. International public and private investors in particular may become wary of investing a significant part of their wealth in assets denominated in a currency owned by a state which might not honor its commitments".
The ECB also reiterated its fears over the impact that a reduction in the value of government bonds might have on banks. "The involvement of the private sector could have direct negative effects on the banking sector of the Eurozone. This could spark off a new recapitalization in the banking system", according to the ECB.
The statements of the ECB officials come as the Eurozone is seeing talks on raising the haircut on the holdings of Greek government bonds, above the level of 21% set in July.
* Credit Suisse: Major European banks might need 220 billion Euros in additional capital
At least 66 major European banks could fail the revised (harsher) stress tests and might need 220 billion Euros in additional capital, according to a study by "Credit Suisse" AG.
According to the study, "Royal Bank of Scotland Group" Plc (RBS), "Deutsche Bank" AG and "BNP Paribas" SA would need the most funding, with a total of 47 billion. They are followed by "Société Générale" SA and "Barclays" Plc, each with a need of 13 billion Euros. The analysts of "Credit Suisse" said: "We consider the recapitalization of banks a step in the right direction, even
