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14 Feb 2019 17:00
NLB d.d., Ljubljana discloses new ECB capital requirements
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NLB d.d., Ljubljana has received new decision establishing prudential requirement from ECB, which is applicable from 1st March 2019, leading to total SREP capital requirement (TSCR) of 11.25%, that includes minimum own funds of 8% (P1R) and own funds requirement of 3.25% (P2R) to be held in excess of minimum own funds requirement on consolidated level.
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Following the Supervisory Review and Evaluation Process (SREP), the ECB has formally notified NLB d.d., Ljubljana of its decision to decrease:
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Ā· the pillar 2 requirement (P2R) from 3.5% to 3.25% CET1
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This decision together with applicable combined buffer requirement leads to overall capital requirement of 14.75%. More details on the composition of the new capital requirements can be found in the table below:
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SREP requirement | Ā | 2017 | 2018 | 2019 |
Ā Pillar 1 (P1R) Ā | CET1 | 4.50% | 4.50% | 4.50% |
Tier1 | 6.00% | 6.00% | 6.00% | |
Total capital | 8.00% | 8.00% | 8.00% | |
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Pillar 2 (P2R) | CET1 | 3.50% | 3.50% | 3.25% |
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Ā Total SREP Capital Requirement (TSCR) Ā | CET1 | 8.00% | 8.00% | 7.75% |
Tier 1 | 9.50% | 9.50% | 9.25% | |
Total capital | 11.50% | 11.50% | 11.25% | |
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Combined Buffer requirement (CBR) | ||||
Conservation buffer | CET1 | 1.25% | 1.88% | 2.50% |
O-SII buffer | CET1 | 0% | 0% | 1.00% |
Countercyclical buffer | CET1 | 0% | 0% | 0% |
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Ā Overall capital requirement (OCR) = MDA threshold Ā | CET1 | 9.25% | 9.88% | 11.25% |
Tier 1 | 10.75% | 11.38% | 12.75% | |
Total capital | 12.75% | 13.38% | 14.75% | |
As at 30 September 2018, NLB Group's CET 1 ratio stood at 16.9%, which is above the new SREP requirement. NLB Group intends to maintain additional Management Buffer above the regulatory requirements. Currently communicated mid-term Total Capital Target of around 17% will be regularly revised by competent bodies to reflect each time applicable capital requirements.
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NLB d.d., Ljubljana
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