ECB To Launch EU-Wide Audit Of Bank's Balance Sheets

Tyler Durden's picture

France and Italy are fighting against ambitious plans by the ECB to basically 'externally audit' 140 banks across the EU representing 80% of Europe's banking assets. The implementation of the project (by the head of financial stability at the central bank) appears to have two main drivers. First, to understand which banks' balance sheets are inhibiting lending (and why); and second, to ensure there is clarification on taxpayer-funded bailouts versus shareholders and depositors taking losses first. As Zeit reports, it seems the ECB appears to be questioning the reliability of the banks own figures.

Via Zeit (via Google Translate),

The European Central Bank (ECB) is working on a strong kick to overcome the crisis. It goes to the timely information in a rehabilitation center to European banks, whose balance sheet problems inhibit lending.


With the implementation of the project was Ignazio Angeloni commissioned, head of financial stability at the central bank. The timing is already set. From the autumn of the monetary authorities will illuminate along with the national supervisory authorities, the balance sheets of major financial institutions in the euro zone. There is a total of around 140 banks, which together cover about 80 percent of the market.


The ECB teams are already formed to examine the books as required directly into the banks. Thus, at the end come out reliable figures, is the intention of the central bank also independent consultants - to be on board - Wirtschaftsprüer or investment companies.




Results are expected by early next year. If they are present, to use a stress test to examine how well the banks cope with a renewed economic slump. Financial institutions that can not even fill possible gaps capital should be recapitalized by the Member States. If they are not able to lift the renovation alone, they can access loans from the ESM bailout fund to fall back.


The risk should not alone bear the taxpayers: Even shareholders, creditors and customers of the affected banks will be first used to cover the losses.


Whether the ambitious timetable can be adhered to, is not clear. Especially France and Italy, reportedly to fight against it, to have their banks by external auditors. The ECB could see forced to look not as accurate when examining the balance sheets, because there is still no European resolution authority for banks are.

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Groundhog Day's picture

Under the guise of an Audit, the ECB is actually identifying all the large depositors and setting up excel speadsheets.  When the time comes to cyprus aka corzine the savers of europe and make them into investors, they'll be able to do it cleanly and swiftly.

Corzined Europeans

Popo's picture

So a basic audit of balance sheets wasn't involved in the so-called "Stress tests"?

What exactly were they testing?

lakecity55's picture

We all know this ends in war, dead people, and wealth(ier) banksters.

Long PMs and stocked Bunkerz!

Its_the_economy_stupid's picture


Knowing who the connected depositors and shareholders and bondholders are will allow pre-bail in "notification" of connected bagholders so an early exit can be arranged.

smacker's picture


Their skill at lying thru their teeth with a straight face?

Urban Redneck's picture

The need to identify the sacrificial lambs for when the CBs sit down and negotiate who lives and who dies.

falak pema's picture

what  were they stress testing ?

If the banksta lies were less consequential than the CB printing press promises taken at face value as economic truths.

If monetary sleight of hand could make structural deficits of debt mountain into hard assets by a stroke of a pen. Now that there is no growth in Eurozone they all know this game is running out of time and dribbling into 100% new money recycling to maintain banks; not sustain the economy. Asymptotes are like icebergs. You can't rebound off them like Superman. 


Cacete de Ouro's picture

Given that gold and gold receivables comprise a large percentage of central banks' international reserves, surely the audit should check and publish whether the gold actually exists or whether its on 'deposit' with the bank of nova scotia or barclays etc, or swappped out in a gold swap.

O wait, I forgot that this would be 'highly market sensitive' information and that the IMF bodss were bullied by the ECB, Bank of England, Bundesbank, Banque de France, FRBNY, US Treasury and BIS into caving in and endorsing the gold and gold receivables shenanigans...We wouldn't want anyone to see the extent of this deception now would we.

So the compliant beancounters will be told, nothing to see, you see the balance sheet should say gold and gold receivables, look the IMF said so..

Cacete de Ouro's picture

Sorry, I thought they were stress test auditing central banks' balance my naive then.....naive!.:)

This obviously never would happen in public...

astoriajoe's picture

That seems like it exactly. They do it over the weekend and have time to spare for Octoberfest beers in September.

Oh the knock-on effects. The great reset, financed by muppet depositors. Someone post that kermit graphic, please.

Separately, in this week's Economist:

Towards the End of Poverty is the cover. Seems to me, in Europe, Poverty is just getting started.

Temporalist's picture

I hear it's never been easier to apply for a student loan...

Quantum Nucleonics's picture

We should probably differentiate between getting Cyprused and getting Corzined.  The former is when your government skims it to cover said government's funding issues.  The later is when the politically connected head of your bank (or other financial institution) transfers your deposit to the bank of one of his politically well conneted buddies after taking a sizable chunk for himself.

Neither is particularly pleasurable for the depositor, and I suppose being both Cyprused and Corzined even less so.

freewolf7's picture

Parallel process, i.e., we learned how to lie from you, boss.

bank guy in Brussels's picture

Yes it is funny

But something is really up here

Partly it may be the tug-of-war between Mario Draghi and the ECB and Angela Merkel, who is trying to keep everything in Europe on hold till the German election

Mario may be posturing to get Merkel to agree to a deal ... if she gets re-elected - with Mario's help in keeping things afloat till then - then after she gets re-elected, she agrees to print money like a post-Keynesian whore ... in order to reverse the collapse of the Southern part of Europe

There are signs of this already in the 180-degree turn in the remarks of cranky and ornery German finance minister Schäuble ... things in southern Europe are so bad it is on the verge of blowing up the German banks and Germany itself, and Schäuble is talking like he wants to print

Article above speaks of deposit confiscation like in Cyprus

Good question is whether Mario Draghi went along with that in Cyprus, or was totally opposed to it along with Ben Bernanke, as Jim Sinclair says ... Sinclair believes the Cyprus confiscation, pushed by Lagarde, is the reason Ben Bernanke cancelled going to Jackson Hole and indicated he would not seek another term at the Fed

If there is another deposit confiscation in Europe, like Cyprus, but in a different country, Europe and its banks will totally implode ... Lehman Brothers x 5 and maybe the global economy as well

People halfway believe the shite that Cyprus was 'unique', but a 2nd confiscation will blow everything sky-high, as Mish likes to say

Mario Draghi is a wily one, and this threat to expose the dirty linen of the EU banks - including Deutsche Bank with its world-class-leading 75 trillion of derivatives as ZeroHedge has documented - is very likely a well-planned chess move by Mario

Dr. Engali's picture

What a sad a pathetic country we have become when we have to strap a hog trough to our necks, because we are too lazy to lift a peice of horse meat to our mouths.

Sudden Debt's picture

I'll bitchslap the first moron I see wearing one.

shovelhead's picture


design fail.

True hands free means the burger must rotate and advance closer to the mouth as the diameter is diminished.

A simple single ram function may be too abrupt for many consumers....

Nue's picture

What's wrong with that? All beasts of burden have feed bags.

not applicable's picture

As the last picture (with the woman driving so that her hands are on the steering wheel and not the burger) illustrates:     another revolting idea in the name of security

orangegeek's picture

Who gives a flying fuck?


Euro banks were stress tested years ago - everything AOK!!!


These fucking assholes just diddle the numbers and then spew it to the media to let the lemmings know that their life savings is in good hands.



Sudden Debt's picture



DeadFred's picture

Because everyone around here knows you're not fine.

Just joking, have a nice day.

Bearwagon's picture

You don't mean these two lemmings, do you? ;-)

(Translation: The first two lemmings. One say's: "You first", the other one answers: "No, you first!")

Sudden Debt's picture

I don't see it...

sodbuster's picture

You mean there MAY be NO sta-bil-a-tee????

Sudden Debt's picture





coloured... also racisme...

toned.... also racisme...

non white.... WRONG! HE'S HALF WHITE!



Winston Churchill's picture

Bankers lying,


gdogus erectus's picture

ECB.  Couldn't they find a better actor for this skit?

GolfHatesMe's picture

Like Bill Murray as Ned Ryerson?

gdogus erectus's picture

Double post.  I'm two for two this morning.

EscapeKey's picture

Dexia and Bankia will no doubt receive doubleplusgood ratings.

Dr. Engali's picture

Right now they are on doublesecret probation.

hmmmstrange's picture

It's got to be pretty bad if you are trying to swap assets with Dexia or Bankia. Their phones are ringing off the hook.

aleph0's picture

ROTFLMAO .... and who's going to Audit the Auditors ?

... "AA"  still around ?

EUSSR :  Dig a hole  ;  Fill it in ;  Repeat


the not so mighty maximiza's picture

this might indicate someting is about to happen, they are trying to look proavtive, like it matters now

Dollar Bill Hiccup's picture

The banks will get an "A" because they are all highly stressed ...

keninla's picture


"ECB appears to be questioning the reliability of the banks own figures."


No shit!!!!  How can you trust any institution anymore. They all lie.


Remember this:

"The information in this report is taken from sources believed to be reliable; however, the Commodity Exchange, Inc. disclaims all liability whatsoever with regard to its accuracy or completeness. This report is produced for information purposes only."

lakecity55's picture

"The information in this so we can later pay out in fiat and not get litigated."

aleph0's picture

BK is BK .... no matter hw many times you "do" the books.

MaxMax's picture

Early next year!  Well, I guess that will kick the can down the road for another 6 months to a year.  Give me a break!  Like they would ever say anything negative to the public about the banks balance sheets.  Stupid show.

smacker's picture


Yeahbut ... will the ECB attempt to mark-to-market the banks' balance sheets? And then order the results to be published? Methinks not. That would surely create complete hell and bring down 80% of EU banks thru insolvency.

LawsofPhysics's picture

Exactly, do you mind if I have a look at the underlying assets and collateral motherfucker?

Bearwagon's picture

No, we won't mind if you have a look or two at our snickers-wrapper! Do go on! ;-)

TheGermanGuy's picture

And once they see, how really fucked up those balance sheets are, the Cyprus template will be applied big scale.

LawsofPhysics's picture

This is stupid, the answer is simple, just look at how much monetization has occured.  They bailed the fuckers out with printed money, how much money did you fuckers print?  There's your fucking answer!