About 25 eurozone banks failed the European Central Bank's financial-health checks on the continent's leading lenders, although more than half of these banks have taken the necessary steps to shore up their balance sheets this year, according to a person familiar with the matter.
Of these banks, 11 or 12 still have additional capital needs, according to the person familiar with the matter. There are no German or French banks among those dozen or so lenders, though there are Italian banks, the person said.
The ECB is due to release the final results of its asset-quality review and stress tests on Sunday. They were based on bank data for the end of 2013, but many banks have since taken steps to raise capital.
"The ECB can't comment on speculation about the outcome of the comprehensive assessment. Any inferences drawn as to the final outcome of the exercise would be highly speculative until the results are final" on Sunday, an ECB spokesman said.
The number of banks failing the exams was reported earlier by Bloomberg .
The ECB is reviewing the finances of 130 eurozone lenders. The European Banking Authority is conducting an overlapping review that brings the total number of tested institutions to 150. It is possible that some non-eurozone banks will fail the tests, pushing the total number of failing lenders above 25.
Analysts and investors say the exams are an important opportunity to restore investor confidence in Europe's banking industry and to restore the flow of credit to the economy.
Gross domestic product in the eurozone came close to stalling during the second quarter and reports over the summer point to only slight growth, at best, during the third quarter. Lending to the private sector continues to contract from year-ago levels.
The ECB is set to become the single supervisor of the eurozone's largest banks on Nov. 4 .
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