LONDON: Some 25 eurozone banks have failed a health check by the ECB, reports claimed on Satur­day, citing leaked documents.

Nearly one in five of the 130 banks surveyed failed the stress test, the Wall Street Journal and the Daily Telegraph said, ahead of the publication of the official results by the ECB on Sunday.

The unprecedented health check of eurozone banks comes before the ECB assumes the role of the bloc’s banking supervisor next month.

The Frankfurt-based ins­ti­tution takes on its new watchdog role on Nov 4. It hopes that a “comprehensive assessment” — made up of a so-called asset quality reviews and a “stress test” — will uncover any potentially nasty surprises beforehand.

Citing a draft memo seen by Bloomberg, the Tele­graph report said only 10 of the 25 banks which failed the stress tests would be told to raise more cash.

The failing banks were thought to be in Ireland, Italy, Greece and Austria and will have until Nov 10 to fill in capital shortfalls, the paper reported.

The banks were already given a preliminary indication of their outcome on Thursday. One of the failing banks is being to be the Austrian lender Volks­banken AG, which the country’s Finance Minister Hans Joerg Schelling said was no surprise, as it had already said it would wind itself down.

Published in Dawn, October 26th, 2014