After that an Asset Quality Review is carried out examining banks’ balance sheets based on information at the end of 2013. And finally, a Stress Test, done in collaboration with the EBA, complements the asset quality review by providing a forward-looking view of banks’ riskabsorption capacity under stress. The Asset Quality Review has progressed and some details of its coverage have been released.
Together with the EU framework for bank recovery and resolution and the Single Resolution Mechanism, the proposed Regulation would reduce the pervasive too-big-tofail and too-complex-to-fail problems also among the largest and most trading-intense banks in Europe. Moreover, I think it is safe to say that the simplification of the large, complex European banks would facilitate the task of the Single Supervisory Mechanism.