Stress testing should be a habit, not a one-off

摘要

After the majority of European banks passed their landmark stress tests, equity markets climbed, credit default swap spreads tightened, high-risk sovereign debt rallied and the euro extended its gains against the dollar.rnA similarly positive response followed the US bank stress tests in 2009. Yet it is important for market participants to realise that this risk-management strategyrn- much enhanced by recent technological advances -is not a one-off procedure, only to be used in an emergency.