Bafin’s Sanio Criticizes EU Regulator Over Bank Stress Tests

Germany’s top financial regulator lashed out at the European Union’s bank stress tests, saying the standards adopted by the agency carrying them out lack “legitimacy.”

The European Banking Authority used a definition of capital that deviates from global rules “with consequences no-one can gauge,” Bafin Chairman Jochen Sanio said in the introduction to the German regulator’s annual report today. The EBA lacks “clear, defined corporate-governance structures, which alone could guarantee process legitimacy,” he said.