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Pimco banking chief expects 18 lenders to fail ECB stress test

[October 22, 2014] LONDON (Reuters) - Pimco's head of global banking, Philippe Bodereau, said he expects 18 banks to fail a stress test of regional lenders when results are published by the European Central Bank on Sunday.

Bodereau, who runs $4.3 billion in the Pimco GIS Capital Securities Fund, said the failures would likely include some German and Austrian cooperative and public sector banks, as well as weak regional lenders in the periphery.

Given recent market volatility, he said it was more likely there would be a positive than negative shock after the results are released, and added that he did not expect to see any big rights issues as a result of the euro zone tests.

(Reporting by Simon Jessop; Editing by Nishant Kumar)

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