Local banks hoping for stress-free tests

The stress tests that Greek banks are due to undergo in the coming weeks will provide an important waypoint in the country's efforts to get back on the path to normality. The parameters for the tests, which were outlined last week by the European Banking Authority (EBA), have provided some optimism that the beleaguered local lenders will be able to limp on toward better days without needing any significant injections of capital.

Greece's creditors, particularly the International Monetary Fund, want to have a clear picture of what state the local banking system finds itself in before the end of the third program, thereby ensuring that no nasty surprises, such as the need for a new round of recapitalizations, will appear in the future. As a result, the stress tests will be carried out in Greece several months earlier than in the rest of Europe, with the results due to be...