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13 European Banks Don't Have Enough Money To Survive A Financial Crisis

Euro burning ecbAP ImagesIn this Nov. 3, 2011 file photo, activists of the Occupy Frankfurt movement have set up a fire near the Euro sculpture in front of the European Central Bank in Frankfurt, Germany.

The European Central Bank said on Sunday that 25 eurozone banks showed a capital shortfall, after a year-long review of finances for 130 of the largest banks in the euro area.

The assessment goes through Dec. 31, 2013. Since then, 12 of the 25 banks have already covered their capital shortfall, which totals €25 billion, the ECB said. That means 13 banks still do not have enough money to whether a financial crisis.

The banks with existing shortfalls, which have not been named, now have two weeks to submit plans to the ECB detailing how the firms plan to raise capital. The banks will have nine months to cover the shortfall, the ECB said.

Out of the 25 banks, Cyprus, Greece, Portugal, and Italy have the proportionally highest shortfall, the report said. You can see Italy leads the pack in the pie graphs below.

ECB Stress TestsECB

In a statement, the ECB said, “By identifying problems and risks, [the review] will help repair balance sheets and make the banks more resilient and robust. This should facilitate more lending in Europe, which will help economic growth.”

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