LONDON — The little-known body that organized this summer’s stress tests into 91 EU banks defended itself Wednesday against charges that its assessment was not rigorous enough, particularly with regard to the banks’ exposure to potentially-risky government debt.
In a statement, the Committee of European Banking Supervisors (CEBS) said the exercise — only seven banks failed when the results were published on July 23 — was “an unprecedented exercise designed to assess the resilience of the EU banking system to possible adverse economic developments, in particular shocks to credit and market risks, including sovereign risks.”
The intervention from the CEBS comes just a day after a report in the Wall Street Journal suggested that the stress tests into 91 EU banks understated some lenders’ holdings of potentially risky government debt.
That spooked investors and pushed the euro around a cent lower on the day against the dollar.
“Individual disclosures of sovereign exposures were an essential component of the exercise and a great enhancement in terms of transparency,” said the CEBS.