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FRANKFURT/MADRID (Reuters) European bank stress tests will train the spotlight on Spain cajas and Germany landesbanks due to opaque finances, political meddling and links to troubled sovereign debt and housing markets.

Large listed euro zone banks such as Santander, BNP Paribas, UniCredit and Deutsche Bank are under constant market scrutiny and their exposure to toxic assets, shaky sovereigns and bad debt is largely known.

But the 45 cajas, or unlisted savings banks, and eight landesbanks are uncharted cheap moncler jackets territory in the European banking sector. The International Monetary Fund moncler online store devoted extra chapters to both of them it its latest Global Financial Stability Report.

The disclosure of the stress test results this month could show that landesbanks problems are not over after several bad investments led to serial multi billion euro bail outs.

investors see the public sector (banks) in some countries as posing a potential systemic moncler outlet store risk and hence contingent liability for the sovereign, Goldman Sachs analysts wrote in a recent note.

credible stress test would add to investor understanding and cheap moncler coats mens could act as a breaker of negative sentiment.

For the landesbanks, the big unknowns that could be exposed in the stress test are their holdings of peripheral eurozone sovereign debt and parts of their loan books which could turn bad under the assumption of moncler outlet a severe cheap moncler jackets mens economic crisis.

While Germany still has funds left moncler sale in its bank stability plan that could be used to backstop banks failing the test, the problem for Chancellor best moncler jackets Angela Merkel government might rather be how to sell yet another bank bailout to voters. toxic assets and went through the first part of the financial crisis unscathed, the main problem is the homegrown toxic asset they helped create themselves: the real estate bubble that is now deflating.

Analysts estimate that they have on their books two thirds of the more than 300 billion euros ($367 billion) in Spanish property loans moncler outlet woodbury that are turning sour as developers default and prices fall after a decade long boom.

SERIAL TROUBLEMAKER LANDESBANKS Germany landesbanks were originally tasked with helping regional governments to support local business, as well as to offer wholesale services to local German savings banks and cater to large corporate clients on behalf of them.

But many of them went astray when they got access to outsized funding after a rush to bond markets in the early 2000s and were desperately seeking assets, many of which led to losses even before the financial crisis. debt instruments required government cash injections and guarantees for four of them WestLB, BayernLB, LBBW and HSH Nordbank last year.

But as the crisis affected Germany real economy and drove up corporate loan losses and as moncler outlet prices the eurozone periphery debt woes evolved, two new vulnerabilities emerged. Both of them will be in the focus of the new European stress tests.

see more risk from Landesbanken exposures in foreign securities and loans, partly as they seem slow to recognize price changes in securities, partly as the credit quality deteriorates, said Deutsche Bank analyst Alexander Hendricks.

The few moncler sale online analysts who have taken a closer look at the banks balance cheap moncler jackets womens sheets say those who were propped up by the government have replenished capital levels enough to tide cheap moncler sale them over, and do not believe they will need fresh cash.

measures provided by the owners and the rescue fund Soffin were sizeable, and we do not expect additional capital requirements among the Landesbanks in the near term, said ratings agency Moody analyst Katharina Barten.

However, some experts say that Landesbanken which have so far got through the crisis well, like NordLB or Helaba, could now be affected.

the problems that could arise with corporate and mortgage bonds, it cannot be ruled out that the owners will have to prop up those banks with extra capital, said one investment banker who has looked at the banks.

CAJAS RESTRUCTURING The moncler usa Bank of Spain announcement that it would release bank by bank stress test results for the entire system has been the moncler outlet online main driver for the publication of the European stress tests, opposed by European regulators until very recently. stress tests last year.

Estimates for the cajas moncler sale outlet capital needs range from 17 billion euros, which the IMF predicted in its April report, to 40 billion euros estimated by Morgan Stanley. Citi analysts in their own stress test arrived at 24 34 billion euros.

However, the recapitalization needs of the cajas, which between them make up half of the Spanish banking system, are very diverse, as exposure to troubled housing loans ranges from 6 percent of the book to 50 percent in some cases.

The Bank uk moncler outlet of Spain strategy is therefore to arm twist strong cajas to take over weaker ones, a process supposed to cut excess capacity and help recapitalize the weaker links. Those deals moncler womens jackets are backed moncler uk outlet by capital injections from the FROB fund.

Thirty nine cajas are already involved in such deals, which overall will cut their number to around 15 to 20. They have so far asked for 10.5 billion euros from the FROB fund to make the mergers possible.

The deals mean sweeping changes for Spain banking sector as caja Madrid, moncler outlet related moncler outlet https://www.monclerdownjacket.biz sale which jointly with uk moncler sale peer Bancaja is taking over five smaller cajas, will become Spain third largest bank by assets through the deal.

Many of them are also expected to seek a change in their governance to make it easier in the future to take in outside investors or list on the stock market, something that is also encouraged by regulators.

Writing by Boris Groendahl, additional reporting by Boris Groendahl, Noah Barkin in Berlin discount moncler jackets and Jesus Aguado in Madrid, Editing by Sitaraman Shankar.

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