Bank shares rally as investors don't stress the tests

AIB and Bank of Ireland shares both spike in response to passing the EU stress tests.

SHARES IN the two Irish banks have risen significantly this morning as investors react positively to the results of the EU stress tests.

Both of the Irish banks involved – AIB and Bank of Ireland – have seen their prices spike as traders get their first chance to respond to the tests, which were released late on Friday after markets had already closed.

Despite only having been credited with “scraping through” the tests, AIB shares took the bigger jump initially, rising to 96c in early trading – a jump of nearly 7% from their close on Friday – before settling at 93c, still recording a rise of about 3.3%.

Bank of Ireland, which passed the tests with a healthier verdict, has seen its shares rise 3c to 77c, a jump of almost 4%.

AIB shares are still only a quarter of the value they were last October, however, with Bank of Ireland about a fifth of their price from late September.

Financial stocks around the world have recorded more modest gains, with an average rise of about 0.8% in early trading.