LONDON (MNI) – The European Union’s bank stress tests will have a
beneficial effect, as they are likely to show the contagion risks from
troubled Spanish savings bank are less than widely perceived, Brian
Coulton, head of EMEA ratings at Fitch Ratings told Bloomberg
Television.
Coulton also applauded the European Central Bank’s decision to buy
bonds to alleviate the sovereign debt crisis, although he said the words
have to be followed up with action.
“I think to some extent the contagion from the Greek crisis to
other countries in the eurozone has been exacerbated by concerns about
how much solidarity there is within the eurozone and that was why the
(ECB) announcement in May was very, very important,” Coulton said.
“If that market confidence benefit is to be sustained the ECB needs
to follow its intention with action,” he added.
On the bank stress tests Coulton said “I think it will be good
because I think there is a perception problem out there of European
banks which I am not sure is in line with the reality.”
He said the concerns about the Spanish banking system are centered
on the Caja, which only make up about 20% of the system.
“The fact that the Caja are seen as a problem has actually been
contaminating the view of the broader. I don’t think that is actually
accurate so I think the stress tests will be beneficial in that sense,”
he said.
— London newsroom: 00 44 20 7862 7491 ukeditorial@marketnews.com
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