# Professor Viral Acharya is interviewed about his research on stress tests

1 Faculty News July 29, 2016 ![Wall Street Journal logo](/sites/default/files/styles/246w/public/assets/images/wsjlogo.jpg?itok=5Qt0z3WX)>

Excerpt from [The Wall Street Journal](http://www.wsj.com/articles/new-study-quantifies-european-banks-capital-shortfalls-as-stress-tests-loom-1469818076) -- "Prof. [Acharya](http://w4.stern.nyu.edu/faculty/bio/viral-acharya)’s analysis calculates banks’ leverage ratios, or equity as a share of total assets, based on their current stock-market valuations. 'When a bank’s market value of equity is approaching zero, it doesn’t matter what the book value of a bank’s equity is compared to what investors believe it actually is; Lehman’s was positive when it collapsed,' Prof. Acharya said in an interview."

[Read more](http://www.wsj.com/articles/new-study-quantifies-european-banks-capital-shortfalls-as-stress-tests-loom-1469818076)