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Despite the relative mildness of the IMF's adverse scenario, its stress test suggests that the banking system faces significant downside risks: –Approximately one-third of U.S. banks would experience a capital shortfall, even assuming a not particularly stringent capital threshold.
It was later found to have a capital shortfall of £1.5bn.
Last week, Moody's Investors Service said MBIA was "somewhat likely" to have a capital shortfall because of a slump in the quality of the assets it guarantees.
But the firm's holdings of European sovereign debt have prompted concerns among analysts that MF Global faces a capital shortfall.
"In this context, if a sovereign backstop is required to meet a capital shortfall, it should be provided, as this would have a high multiplier".
These tests revealed a capital shortfall of just $75 billion.
The new guidelines left UniCredit with a capital shortfall of about 7.4 billion euros.
A capital shortfall at Germany's largest bank might provoke a banking crisis across Europe.
Officially, just eight banks failed the European Union's latest stress tests, with a capital shortfall of 2.5 billion euros ($3.5 billion).
"Consequently, the announcement today does not affect the PRA's assessment that the Co-operative Bank has a capital shortfall of £1.5bn relative to 7% core equity capital after adjustments".
Barclays was forced to tap investors to plug a capital shortfall identified by the Bank of England and will now hope to quash any concerns about its capital position.
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Justyna Jupowicz-Kozak
CEO of Professional Science Editing for Scientists @ prosciediting.com