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Spain ‘Chases Cockroaches’ With Bank Stress Tests
When Spain reveals the size of the hole in its banking system with the publication of stress test results later today, the credibility of that estimate risks being undermined by a deteriorating economic outlook. The test conducted by Oliver Wyman on 14 banking groups is a precursor to the formation of a so-called bad bank to which troubled lenders will transfer soured real estate to bolster their balance sheets. The results will be released after the market closes in Madrid. The independent stress test to assess the damage wrought by the property crash is a condition of Spain’s 100 billion-euro ($129 billion) ... (full story)