Banks get clean bill of health overall

EUROPE’S banks got a clean bill of health from stress tests that assumed a severe double-dip recession and a rise in interest rates over the next two years.

Of the 91 banks tested, seven failed, five of them Spanish, one German and one Greek. The two Irish banks were among the majority that passed.

But the results were immediately attacked by commentators because they did not factor in what would happen if a country defaulted and was unable to repay the money it owed banks.