Italian and British banks will come through European stress tests without needing to raise new capital, top officials said on Thursday.
"The tests on Italian banks will obviously present diverse results but I am confident that they will show that the capital resources of the single banks are adequate," said Bank of Italy Governor and European Central Bank member Mario Draghi.
British finance minister George Osborne said UK banks would not need any government help to shore up their financial position after the tests are released on July 23.
Osborne said it was important to reassure markets with the tests on 91 banks designed to provide a health check on the industry and that there is "a plan to stand behind any banks that don't meet them."
Banks will be assessed on how well they can withstand another economic downturn and losses on Greek and some other government bonds, and whether they need to raise capital to provide a cushion to protect investors.
Like U.S. tests carried out last year, the aim is to clear the air, pinpoint any weak spots that need restructuring and restore confidence among investors.
Six Greek banks are being tested and Piraeus Bank on Thursday bid for state-controlled ATEbank and Hellenic Postbank (TT) to kick-start consolidation being urged by the government, seen as key for the survival of its banks.
The stress tests could also help speed the consolidation among Spanish cajas, the regional lenders likely to be shown to be short of capital.
Barclays Capital credit analysts said institutions most likely to fail the tests were the Spanish cajas, Germany's landesbanks and Greek banks.
BarCap estimated the capital needs of the cajas at 36 billion euros, 34 billion euros for the landesbanks and 8.6 billion euros for Greek banks.
There are splits in the 27-nation EU about how severe to make the test and how much to divulge.
It is not clear how big any "haircut" will be on government bond holdings, what the minimum solvency level will be and how long any failing bank will have to raise funds, or where back-up cash will come from.
Draghi called for "a maximum of transparency" in the publication of the results and said European governments should be "ready to intervene if the results show capital weaknesses and market solutions are not available".
