Following the rating agency's stress tests, which were conducted on the balance sheets of most Moody's-rated banks in H2 2009, the rating agency concluded that French banks were able to withstand losses associated with a worse-than-expected economic scenario. "With an aggregate loan allowance of EUR64 billion at year-end 2009, French banks have already provisioned above the level of losses that Moody's expects them to incur, and their current capital buffers are able to withstand further deterioration," said Hill. Although exposures to challenged European sovereigns — like Greece, Portugal, Spain and Ireland – are substantial, Moody's believes these to be manageable and notes that EU stress tests seem to corroborate its conclusions. However, Moody's is not saying that the French system is entirely immune to a potential pronounced double-dip recession or a systemic crisis, neither of which are currently being forecast by Moody's.