european bank stress tests

Although Wall Street anxiously awaited the results of bank stress tests in Europe, the real news is elsewhere: the improving economic conditions across Europe. Can the U.S. learn a lesson from Germany and France?

Banking regulators tested the soundness of 91 European banks this week to see if they could withstand a financial crisis, and only seven failed to pass muster. But some analysts say the tests may have been too easy, and wonder what would happen if a real "worst-case scenario" hit.

A clear majority of the 91 EU banks have passed stress tests conducted by regulators - but Germany's nationalized lender Hypo Real Estate Holding AG failed. It was the only German bank to fail the European stress test. Officials said Friday that HRE's tier 1 capital ratio would fall under 6...