Greece is likely to postpone stress tests for its banks, according to a central bank source. Keep in mind that regular stress tests were agreed to by Greece, as one stipulation behind the 110 billion euro funding support it received from the IMF and Eurozone in May.
Not much of a reason was given for the delay, but markets were handed an assurance that the stress tests wouldn't say anything new:
"The stress tests will not be done in September," said a Bank of Greece official who did not want to be named. "They will take place later in the autumn, very likely in October."
...
"Banks were stress tested recently, not much has changed since then," the official said.
In the July test, ATEbank's Tier 1 ratio fell to 4.36 percent, below a 6.0 percent safety threshold.
"As is stipulated in the (EU/IMF/ECB) memorandum, there will be regular stress tests," the official said without providing details on how the Bank of Greece tests would differ from the simulation conducted by CEBS.
The IMF and Europe's central bank have agreed to the delay nonetheless, and one reason could be that Greece wants to use banks' nine-month results (ending September) in stress test calculations according to the AFP.
Still, uncertainty never helps and it just looks shoddy when Greece and the IMF are gaming the release of stress tests. Greece's Athex stock index is down nearly one percent today despite a general rally for European shares so far today.
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