Four British banks have passed a stress test to determine if they would be able to survive an economic crisis comparable to the one seen in 2008.
The Royal Bank of Scotland - 80% owned by the UK Government - satisfied the health check set by the European Banking Authority.
Lloyds Banking Group, which is 25% owned by taxpayers, narrowly met the requirements, which were designed to ensure that financial institutions will remain resilient in the event of another downturn.
However, the results of a more detailed stress test on British brands, performed by the Bank of England, are only expected on 16 December.
These initial findings could prove problematic for Lloyds, which is hoping to resume dividend payments to shareholders.
But in a statement, the group said: "Our strong position reflects the steps taken by the group's management over the last three years to return its balance sheet to a robust position, and we will continue to use this strong basis to help Britain prosper."
On Saturday, our City Editor, Mark Kleinman, revealed that Lloyds is planning to close more than 200 branches, placing 9,000 jobs at risk.
Meanwhile, a detailed report by the European Central Bank - which excluded British firms - has revealed that 25 banks are in poor financial health, and that 13 of those desperately need to strengthen their buffers against losses.
This means that one in five Eurozone banks may be unable to survive another major economic crisis.
If the failing companies are unable to raise more cash in the next nine months, they could be forced to shut down. The financial institutions affected are mainly based in Italy, Greece and Cyprus.
It is hoped that the in-depth review, which covered 130 of the biggest European banks, will help to identify potential vulnerabilities in the banking system, give companies better access to credit, and strengthen the bloc's economy.
The ECB, which is based in Frankfurt, is set to become Europe's central banking supervisor on 4 November. It organised the test so it would become aware of any weaknesses before it gained regulatory powers.
One of the organisation's main tasks is to help small and medium-sized companies across Europe find it easier to get accepted for credit from their bank of choice, enabling them to expand and stay in business.
A lack of available credit has been blamed on the Eurozone's stagnation - with the group of 18 nations using the euro showing no growth whatsoever between April and June.
"This review of the largest banks' positions will boost public confidence in the banking sector," said Vitor Constancio, the vice president of the ECB. "It will help repair balance sheets and make the banks more resilient and robust."
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