VIENNA (Reuters) - Austrian lender Raiffeisen is set to pass a stress test of big European banks but others will need to raise capital, setting off a scramble for equity, the chief executive of Raiffeisen Zentralbank (RZB) [RZB.UL] told newspaper Kurier.
Walter Rothensteiner, who is also chairman of RZB's listed unit Raiffeisen Bank International (RBI) (VI:RBIV), reiterated that RBI should rebound to profit next year after an expected 2014 loss due to hits from Ukraine and Hungary.
"When the European Central Bank looks at 129 banks simultaneously, there will be some activity when the stress tests are published at the end of October," Rothensteiner was quoted as saying.
"I would be amazed if Raiffeisen did not make it, but there will be some banks in Europe that will then need capital relatively quickly. The market for equity will get difficult across Europe."
Rothensteiner played down the impact of Western sanctions on Russia - RBI's single most profitable market in central and eastern Europe - over allegations that Moscow was supporting separatist rebels in Ukraine.
"Russia is handling the financial sector very well. Even in the bank in Austria we are hardly feeling any effect from the sanctions. The new (European) capital rules are preventing business much more," he said.
He was referring to stricter rules on how much capital banks must hold to back assets like loans, measures that he said will cause bottlenecks when demand for credit picks up again.
RZB is one of six Austrian lenders undergoing strict scrutiny by the ECB before it takes on direct supervision of big euro zone banks next month.
Officials said last week most Austrian banks seemed well-placed to pass the tests, although that excluded Volksbanken AG , which has already announced plans to wind itself down.
(Reporting by Michael Shields, editing by Louise Heavens)