Coinciding with the Friday news that seven out of 91 European banks had failed stress tests, the US also reported the collapse of seven more banks - including Georgia's Crescent Bank and Trust Company - in the country. These banks were taken over by the Federal Deposit Insurance Corporation (FDIC).

With the recently-announced failure of the seven banks, the total number of US bank failures is now likely to surpass the last year figure of 140 bank failures, chiefly due to rising bad debts tied to commercial and residential mortgages. Already 100 banks have failed in the country thus far.

According to the information forwarded by the FDIC, which primarily acts as a receiver and protects depositors, the total assets of the seven recently-failed banks stood at $2 billion, with the largest among them - the Crescent Bank and Trust - having assets over $1 billion.

Meanwhile, commenting on the results of the stress tests conducted in Europe, and comparing them with the tests conducted in the US last year, research firm AlphaValue's Christophe Nijdam said the European banks' failure rate was only 8 percent; as against US' 53 percent bank failures in its last year's stress test - when 10 out of the 19 banks tested required nearly $75 billion (£48 billion) in new capital.

Talking about the European tests, research firm CreditSights said: "Controversy remains over the treatment of sovereign risks, but private sector loan losses look to have been adequately factored in."