FRANKFURT (Reuters) - German banks have no reason to be concerned over the upcoming results of a Europe-wide stress test, Germany's banking association BdB said on Wednesday.
This year's stress test of top financial institutions in the European Union focuses on challenges at some Italian lenders, where banks face 350 billion euros (£292.7 billion) in bad loans and debt ratios are on the rise.
"I don't expect that the release of the stress test results will lead to profound distortions among one or several German banks," BdB head Michael Kemmer told a press briefing.
Kemmer said he was confident that the stress test results on July 29 will lead to "confidence building" within Germany. He also wasn't foreseeing a banking crisis in Italy.
"I believe that Italy must and can solve the problem," Kemmer said.
Italian banks' outstanding debt with German lenders is at 16.5 billion euros, a comparatively "manageable amount," Kemmer said.
"Even in the worst case scenario for Italy, which I don't expect, there would be no risk of contagion for German banks," the BdB head said.