All European Union countries will publish the results of stress tests on their banks in the second half of July at the latest to boost investor confidence in the financial sector, EU President Herman Van Rompuy said.
"We agreed that the so-called stress tests of banks will be published at the latest in the second half of July," Van Rompuy told a news conference after a summit of EU leaders on Thursday.
Spanish Prime Minister Jose Luis Rodriguez Zapatero, also present, said publishing the results was the best way to stop rumors about the condition of Spanish and other banks.
"There is nothing better than transparency to demonstrate solvency," Zapatero said.
"These stress tests must be demanding in nature. We need to look at the most stringent tests possible in terms of our growth because that will favor our credibility," he said.
The EU has so far conducted only one stress test of its whole banking sector, not individual countries or banks. The results, shown in autumn 2009, said the sector was sound and could withstand a much worse economic downturn than had taken place.
But German Bundesbank head Axel Weber said on Thursday that a new set of European bank stress tests was needed to include a broader swath of the banking industry as well as new stress scenarios such as the sovereign debt crisis.
Speaking at a conference in Frankfurt, Germany, Weber -- also a member of the European Central Bank's Governing Council -- said he had pushed for disclosure of the stress test results "by bank and by country" on an international level.
Germany had been skeptical about revealing details of tests on the financial health and risk exposure of its banks, but has dropped its objections after France and Spain came out in favor of a move the United States has pressed Europe to take.
Banks remain undecided on whether disclosure makes sense.
The Association of German Banks, which represents large private-sector lenders such as Deutsche Bank and Commerzbank, said it may be open to disclosure, providing the results leave no room for "misinterpretation."
The German association of public-sector banks, which represents the troubled Landesbanken sector, opposes such disclosure.
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