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EBA stress test results confirm strength of EU banking sector

1 August 2025, Brussels: The European Banking Federation (EBF) has reacted to the results of the 2025 EU-wide stress test conducted by the European Banking Authority (EBA). The stress test assessed EU banks’ performance under a baseline and adverse scenario during a three-year time horizon, from 2025 to 2027.

The results confirmed the strong position of the EU banking sector. The capital depletion under the adverse stress test scenario amounts to 370 bps, which shows a lower impact than the results of the last exercise done in 2023. Today’s results underline that European banks have a stronger capacity to absorb losses, based on hypothetical and severe scenarios. This EU-wide stress test is a scenario-based analysis measuring how the banking sector would fare under hypothetical adverse economic developments. It is a risk-based exercise and not an assessment of the impact of regulatory changes.

“The 2025 stress test confirms the strength of the EU banking system. This is not a coincidence, but the result of a longstanding strategy to restore EU banks’ resilience. Going forward, financing the economy will continue being the primary objective of EU banks. To enable it, simplification of regulatory and supervisory processes should be high in the policymaking agenda. We look forward to simplifying the methodology and operationalisation of stress tests by regulators and supervisors in future exercises”, said Gonzalo Gasos, Senior Director of Prudential Policy & Supervision, European Banking Federation.

For more information:

Gonzalo Gasós, Senior Director of Prudential Policy & Supervision, g.gasos@ebf.eu

Francisco Saravia, Senior Policy Adviser – Prudential Policy & Supervision, f.saravia@ebf.eu 

The European Banking Federation is the voice of the European banking sector, bringing together national banking associations from across Europe. The federation is committed to a thriving European economy that is underpinned by a stable, secure, and inclusive financial ecosystem, and to a flourishing society where financing is available to fund the dreams of citizens, businesses and innovators everywhere.