Irish bank shares posted gains despite continuing fears about the health of Italian lenders and a cautionary report from Fitch Ratings on the outlook for Irish lenders after Brexit.

Specialist Italian pension funds will consider a government request to pour money into a bank bailout fund, days before European stress tests are expected to show the country’s third-largest lender is in need of urgent capital.

Roughly one in five of the eurozone’s top lenders failed landmark health checks at the end of last year but most have since repaired their finances, the European Central Bank said yesterday.

Europe’s landmark assessment of its banks just about scrapes the credibility test.

European Union banks face their toughest probe yet in a bid to weed out the sector’s weaklings, the bloc’s chief watchdog said yesterday, announcing stress tests intended to help draw a line under the financial crisis.