Economy, Banks | featured news

European risk assets remain under pressure as investors digest the latest round of bank stress tests by the European Banking Authority.

Eight of 90 banks have flunked stress tests that project how they would fare in another recession, and 16 more barely passed, Europe’s banking regulator said Friday. The failing banks should “promptly” take steps to strengthen their financial cushions against losses, the European Banking Authority said as it released the results. The banks that barely passed may also face pressure to strengthen their finances along with the ones that failed.

Afghanistan said on Sunday it won't be able to address a key International Monetary Fund concern over a looming cash crisis, sparked by a corruption scandal at a failed bank, for more than a month because lawmakers are on holidays.

The country’s economy, which crashed in 1994 and 2001 and was set back by the global financial crisis, is showing signs of overheating, fueled by consumer spending.

Icelandic voters appeared Sunday to have rejected a government-approved deal to repay Britain and the Netherlands $5 billion for their citizens' deposits in the failed online bank Icesave.

The European Central Bank is poised to raise interest rates from a record low 1.0 percent on Thursday and more is likely to follow but, fearful of heaping more pain on the euro zone's stragglers, it will give few clues about when the next move will come.

The government panel, the Financial Crisis Inquiry Commission blames: Banks that made reckless bets, credit rating agencies that endorse risky mortgage-backed securities and government regulators who overlooked warning signs until they threatened the global financial system.

Banks are finally beginning to lend, the big ones that is. Commercial and industrial lending is up this quarter 0.2% from the third quarter, according to Moody's Analytics. That might not sound like much, but it's the first quarterly increase in two years. This is great, right? After all, if banks are lending more to businesses, they can expand and begin to hire. That's true, but this trend reveals something else: the financial crisis has created an environment where big banks are getting bigger, as the small ones struggle.

Ireland's government moved to reassure anxious investors by announcing it will split nationalized lender Anglo Irish Bank in a bid to contain the impact of the bank's bailout on the country's economy.

Broad probe testing 91 European banks finds most are fit to withstand severe economic shocks.