Concerns grow over stress tests’ impact on bank capital market

The European Central Bank on Wednesday outlined the methodology of its upcoming bank asset quality review (AQR) and stress tests, which will indicate the health of the eurozone’s lenders before the ECB takes over as sole supervisor in November 2014. The results of the tests will inevitably lead to some banks needing to bolster their capital — but ECB president Mario Draghi is concerned that new state aid rules around the use of public rescue funds could undermine investors’ appetite for bank capital.