Europe should follow the US in conducting stress tests on individual banks, the International Monetary Fund said yesterday as it warned that economic recovery in the region next year depended on bolder and more forceful policy action.
Fresh moves by European banks to clean up the banking system and face their recapitalisation needs were essential to restoring trust in the financial system, according to the report on Europe published by the Washington-based agency.
“Further actions by policymakers, particularly in the financial sector, are needed to restore market trust and confidence,” said Marek Belka, director of the IMF's European department and a former Polish prime minister.