The European Banking Authority and the European Central Bank have published the results of the 2025 EU-wide stress test, revealing that the bloc's banking sector would sustain aggregate Common Equity Tier 1 capital depletion of 370 basis points under the adverse scenario. The aggregate CET1 ratio (transitional, under CRR3) across the 64 banks tested would fall from a starting point of 15.8% to 12.1% by end-2027, representing a depletion of 370 basis points — narrower than the 479 basis points recorded in the 2023 exercise, according to the EBA. The EBA published the results on 1 August 2025, and the ECB published its own results for the euro area banks it supervises directly on the same day.
The stress test is conducted biennially. The 2025 adverse scenario was designed jointly by the European Systemic Risk Board and the ECB, built around a severe recession triggered by escalating geopolitical tensions and trade protectionism.
COVERAGE AND BANK-LEVEL DATA
The 64 banks covered by the test account for approximately 75% of total banking sector assets in the European Union.
The EBA has emphasised that the stress test is not a pass-or-fail exercise but rather a diagnostic tool that informs the ongoing supervisory dialogue between each bank and its lead regulator.
The EBA published detailed bank-by-bank data for each of the 64 banks alongside the aggregate findings.
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