EU’s 2021 stress test includes ‘very severe’ adverse scenario
Adverse scenario foresees unemployment rising sharply and massive asset shock
European Union regulators released their plans to stress test the bloc’s largest banks, including a “very severe” adverse scenario based upon a prolonged Covid-19 pandemic.
The European Banking Authority will be co-ordinating the stress tests, as it has in previous years, it announced on January 29. Its announcement came after the 2020 exercise was postponed due to the Covid-19 pandemic.
The EBA said the stress tests will be conducted on 50 banks, representing a total of 70% of the EU banking
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