Date: Wednesday, July 13, 2011, 2:53pm PDT

The worst might not be over for Oregon banks.

On Wednesday, New York research firm The Invictus Group released the results of stress tests it performed on each of the nation's 1,983 banks.

Oregon ranked No. 11 for the highest percentage of undercapitalized banks. Oregon banks need to raise nearly $125 million in fresh capital to serve as a sufficient cushion against bad loans, according to Invictus.

Of the 35 banks included in the Oregon data, 15 are undercapitalized. Of the $33.7 billion in assets held by Oregon banks, 12.5 percent, or $4.2 billion, are held by undercapitalized banks.

The data conflicts with other data that says the financial health of Oregon banks is improving.

Seven Oregon banks remain under regulatory orders to raise capital, but Oregon banks posted a collective profit in 2010 after two years of sizable losses.

@matthewkish | mkish@bizjournals.com | 503-219-3414