36 EU banks would have failed test, covered bonds, ECB stress test, ECB Stress Tests Seen as Bolstering Confidence in Banks., econom, economics, Europe's banking health check, European Central Bank, European Central Bank buys covered bonds to boost economy., global capital rules, in Possible Economic Turning Point, Just 13 Banks Fail E.C.B. Stress Test, stress test, Under full capital rules
Under full capital rules, 36 EU banks would have failed test Reuters India
Thirty-six banks could have failed with full rules Irish Independent
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The European Central Bank last week bought €1.7 billion ($2.15 billion) of secured bank debt as part of its stimulus program to boost the region’s flagging economy.
The purchases of covered bonds—so-called because they are backed by a pool of loans such as residential mortgages, and considered the safest type of debt banks issue—exceeded the amount spent in the first full week in each of the central bank’s previous two covered bond-buying programs combined, ECB data published Monday show.
Last month the ECB said the stimulus program—which also includes providing cheap loans to banks, and purchases of asset-backed securities—was intended to reinflate the bank’s balance sheet to levels last seen in early 2012. That would imply the combined measures could be worth at least €700 billion.
This is the ECB’s third covered-bond program since 2009. Under the first program, the ECB purchased €60 billion of these securities. A second program fizzled, however. The central bank purchased less than half of the €40 billion it had targeted.