Monday's Biggest Impact: Europe's Bank Stress Test too Soft

Happy Weekend Masters, this just in -- Just seven European banks failed a health check and were ordered to raise their capital by 3.5 billion euros ($4.5 billion), confirming fears the continent's long-awaited stress test was too soft.

Europe's Media React to Bank Stress Test Results...

LONDON (Reuters) -Following are selected comments from media around Europe on Saturday.

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THE TIMES (BRITAIN)

Anyone expecting a horror show in yesterday's Europe-wide stress-testing exercise hasn't been paying attention. The aim of the process all along has been to calm market jitters, not aggravate them ... The danger, however, is that the results are so benign that they have no credibility at all ... But the exercise will do nothing to equip Europe's weaker banks to face either a sudden financial hurricane or a prolonged economic winter. Fingers crossed, for all our sakes, that they encounter neither.

NRC HANDELSBLAD (NETHERLANDS)

Does this take away all mistrust? Not completely. Contrary to the U.S. stress test in the spring of 2009 at the 19 most important systemic banks not all details were made public this year in Europe about the financial and economic adverse scenarios for the systemic banks. The most important parameters are now known. But because of the obscurity beforehand much doubt has been created in the run up to the test. The impression could now remain that some banks passed because the stress test perhaps was not severe enough.

IL SOLE 24 ORE (ITALY) What was at stake, rather more than the solidity of the institutions, was the credibility of the central banks. Did anyone really think that at 6.00 p.m. on Friday July 23 they would uncover an enormous shortfall in bank capital reserves in the event of a worsening in the economic situation or fears about whether public sector debt could be refinanced? The 'market' would have abandoned any confidence it had in the governors: 'where were they before?', they would have said. 'What were they telling us over all these months?' The risks would have been blown up enormously. So the outcome of this operation is modest.

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SOURCE: http://abcnews.go.com/Business/wireStory?id=11242640