EUROPEAN BANKING STRATGEY: The next event is the EBA stress test on 29 July, and in isolation we argue this could be a positive outcome. We have run a model, which resembles the EBA exercise, covering 27 EU banks. We estimate total CET1 consumption to 164bp in the adverse scenario, but well above our Brexit 'shallow recession' impact of c.50bp. We note, banks should do better as 1) capital is better; 2) ESRB scenario is somewhat milder. Investors will screen for outliers; names with high NPL levels, small mgmt. buffer to SREP and/or material litigation costs since 2011 are sensitive: We see that UCG (N) and DB (N) could be c.100bp (or more) below their adj. SREP ratio, in the stress test.