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Banks (Finance)

European Banks to Undergo Stress Test, Boeing to Acquire Argon ST

Strategic Insights

— 2 min read

The European banking system has been put under scrutiny as European Union authorities have agreed to bring more banks under the public stress test. This decision follows the shutdown of the special loan facility by the European Central bank to Euro-zone lenders, which has caused concerns about the financial stability of European banks. The stress test will include 60 to 120 banks, up from 22 big banks last year, and will determine whether they have sufficient financial strength to survive serious economic shocks and potential sovereign debt default in the Euro-zone. The results of the stress test are scheduled to be released in the latter half of July. Meanwhile, Boeing Company has announced its decision to acquire Argon ST Inc. in an all-cash transaction worth $775 million, aiming to extend its footprints in the cyber and intelligence markets.

Key Takeaways:

  • The European Union authorities have agreed to bring 60 to 120 banks under the public stress test, up from 22 big banks last year, to restore transparency and reliability in the European banking system.
  • The stress test will determine whether the included banks have sufficient financial strength to survive serious economic shocks and potential sovereign debt default in the Euro-zone.
  • The results of the stress test are scheduled to be released in the latter half of July, with banks such as German Landesbanken and Spanish savings banks being included.
  • Boeing Company has announced its decision to acquire Argon ST Inc. in an all-cash transaction worth $775 million to extend its footprints in the cyber and intelligence markets.
  • The acquisition will allow Boeing to better address the C4ISR, cyber, and intelligence markets and meet the changing requirements of the U.S. Defense Department.
  • The largest merged entity in Spain's banking system will include seven institutions and become the third-largest bank by financial assets in Spain.

Statistics:

  • 60-120 new banks will be included in the European stress test this year, up from 22 big banks last year.
  • The stress test will determine the financial stability of European banks and their ability to survive serious economic shocks.
  • The results of the stress test are scheduled to be released in the latter half of July.
  • The cost of the acquisition of Argon ST Inc. by Boeing Company is $775 million.
  • The acquisition will be completed by the end of the third quarter 2010, subject to regulatory approval and tendering of a majority of outstanding shares.
  • The largest merged entity in Spain's banking system will have $13.5 billion in public funds to reorganize and boost its capital levels.

Sources:

  • http://www.zacks.com/
  • http://at.zacks.com/?id=4579
  • http://at.zacks.com/?id=5514
  • http://at.zacks.com/?id=5516
  • http://at.zacks.com/?id=4580

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