This section is dedicated to the EBA EU-wide stress tests and provides information about the methodologies and the scenarios used, as well as any additional supporting information released by the EBA during the conduct of the exercise.

EBA's role in stress testing

One of the responsibilities of the European Banking Authority (EBA) is to ensure the orderly functioning and integrity of financial markets and the stability of the financial system in the EU. To this end, the EBA is mandated to monitor and assess market developments as well as to identify trends, potential risks and vulnerabilities stemming from the micro-prudential level.

One of the primary supervisory tools to conduct such an analysis is the EU-wide stress test exercise. The EBA Regulation gives the Authority powers to initiate and coordinate the EU-wide stress tests, in cooperation with the European Systemic Risk Board (ESRB). The aim of such tests is to assess the resilience of financial institutions to adverse market developments, as well as to contribute to the overall assessment of systemic risk in the EU financial system.

The EBA's EU-wide stress tests are conducted in a bottom-up fashion, using consistent methodologies, scenarios and key assumptions developed in cooperation with the ESRB, the European Central Bank (ECB) and the European Commission (EC).

Stress tests 2020

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    The Board of Supervisors (BoS) of the European Banking Authority (EBA) agreed on the tentative timeline and sample of the 2021 EU-wide stress test. The exercise is expected to be launched at the end of January 2021 and its results to be published at the end of July 2021.

    30/07/2020

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    EU-wide stress test postponed to 2021 to allow banks to prioritise operational continuity

    In the context of the COVID-19 (Coronavirus) outbreak and its global spread since February, the European Banking Authority has decided to postpone the EU-wide stress test to 2021 as a measure to alleviate the immediate operational burden for banks at this challenging juncture. The final timeline for the EU-wide stress test will be communicated in due course.

    19/03/2020

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    The European Banking Authority (EBA) launched today the 2020 EU-wide stress test, the fifth exercise since its establishment, and released the macroeconomic scenarios. The adverse scenario follows for the first time a ‘lower for longer’ narrative, a recession coupled with low or negative interest rates for a prolonged period. The EU real GDP would decline by 4.3% cumulatively by 2022, resulting in the most severe scenario to date. The EBA expects to publish the results of the exercise by 31 July 2020.

    31/01/2020

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    The European Banking Authority (EBA) published today the templates for the 2020 EU-wide stress test, after the feedback received by banks during the testing phase. The stress test exercise will be formally launched in January 2020.

    16/12/2019

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    The European Banking Authority (EBA) published today the final methodology and draft templates for the 2020 EU-wide stress test along with the key milestones of the exercise. The methodology and templates cover all relevant risk areas and incorporate the feedback received during the discussion with the industry in the summer of 2019. The stress test exercise will be formally launched in January 2020 and the results published by 31 July 2020.

    07/11/2019

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    The European Banking Authority (EBA) published today the 2020 EU-wide stress test draft methodology, templates and template guidance, which will be discussed with the industry. The 2020 exercise will assess EU banks' resilience to an adverse economic shock and inform the 2020 Supervisory Review and Evaluation Process (SREP). The methodology covers all risk areas and builds on the methodology prepared for the 2018 exercise, while improving some aspects based on the lessons learnt. The preliminary list of institutions participating in the exercise as well as the timeline are also released today.

    25/06/2018