Companies are becoming choosier with their lenders, putting them through rigorous tests and analysing their financial health to pick out business partners.

They are reviewing their bank counterparties, partly in response to worries about the euro zone crisis and its effect on lenders, and because of stricter financial regulations.

Gavin Jones, vice-president in the treasury of Netherlands-based Ahold, told the annual conference of the Association of Corporate Treasurers the retailer had examined the banks that it presently deals with.

Ahold had asked everything from how they perform against published financial targets, did they take any money from the European Central Bank (and its cheap financing programme) -- quite a detailed analysis of their financial position, he said.

Bigger firms, which provide business for banks through big loans, payment systems, foreign exchange transactions or derivatives, can be pickier, though smaller firms may struggle to secure cash.

Philip Learoyd, head of funding and treasury operations at SABMiller , said the euro zone crisis had prompted the firm to compile a more diversified group of bank counterparties.

He added the brewer was undertaking a formal review of its entire approach to bank counterparties.

The 2008 collapse of U.S. investment bank Lehman Brothers led to worries other banks could fail, and the euro zone crisis -- which has battered European lenders for two years -- is doing little to allay those concerns.

Banks also irked many companies, including some of their best clients, when they pulled out of loans and started cutting credit lines at the height of the financial crisis.

Regulations are now playing a part.

Companies are scrutinising their counterparties because constrained banks are doing the same -- cutting down client lists to focus on those that give them the biggest wallet share, or the most business across a range of products.

So companies are trying to avoid being caught out by banks turning them down by studying their relationships in depth, calculating whether lenders are in a position to keep supporting them based on the level of business they do together.

Since the financial crisis, corporate treasurers at top-rated companies have sought to improve their funding mix and be less reliant on bank loans, for instance by accessing bond markets directly.

Before the introduction of the euro in 1999, few European companies accessed the bond market because of the large foreign exchange risk in Europe's fragmented landscape, which consisted of dozens of national currencies.

Instead, particularly the weaker-rated companies, relied on cosy lending relationships with their banks, which helps explain why the European banking sector is far larger as a percentage of the region's economy than that in the United States.

But stricter capital requirements have made it harder for the banks to splash out on easy money, forcing companies into the hands of non-bank investors, not just in their home markets but across regions.

The banks still play a role in arranging such bond sales, but there is no risk on their balance sheets.

Companies still need banks for other services they cannot do without, such as derivative deals which they use to hedge exposures and plan their finances.

Both Learoyd, and Jones at Ahold, said they looked at a range of factors when assessing their banks. A key one was ratings, though these have been gradually cut post-financial crisis and more downgrades loom.

Other pointers include share price movements, market capitalisation, and credit default swap levels -- a derivative that acts as an insurance against default and is meant to show how likely a credit is to not repay its debts.

Learoyd, however, said he was most interested in the elements under a bank's control, such as its core capital ratios. That shows the management's view on risk appetite, he said.

(Editing by David Hulmes)