FIVE IRISH-BASED INSTITUTIONS have been included in a list of banks to be subjected to a series of tests by the European Central Bank next year.
Bank of Ireland, AIB, Merrill Lynch International Bank, Ulster Bank and Permanent TSB have been named on a list of 128 banks to take part in the process, which is aimed at boosting confidence in the sector.
The list also includes 16 lenders in Spain, 15 in Italy and four each in Portugal, Greece and Cyprus.
The ECB says the move is aimed at achieving greater transparency of the banks’ balance sheets and more consistency in supervisory practices across Europe.
It’s planned the assessment will commence in November of this year and take 12 months to complete.
According to the ECB:
The exercise has three main goals: transparency – to enhance the quality of information available on the condition of banks; repair – to identify and implement necessary corrective actions, if and where needed; and confidence building – to assure all stakeholders that banks are fundamentally sound and trustworthy.
The outcomes and any recommendations will be published at the end of the process, prior to the ECB assuming its supervisory role as part of a European banking union in November of next year.
“A single comprehensive assessment, uniformly applied to all significant banks, accounting for about 85 per cent of the euro area banking system, is an important step forward for Europe and for the future of the euro area economy,” ECB President Mario Draghi said.
“Transparency will be its primary objective. We expect that this assessment will strengthen private sector confidence in the soundness of euro area banks and in the quality of their balance sheets.”
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