Silvia Merler published a great post on the solvency of Greek banks. Though she focuses on CET1 ratios, I just realised that Article 92 of the CRR requires this: 1. Subject to Articles 93 and 94, institutions shall at all times satisfy the following own funds requirements: (a) a Common Equity Tier 1 capital ratio… Read More Greek Banks and Article 92 CRR
With the EBA and the ECB announcing results of the stress test and the AQR next week, and with feeble banks shivering, you may consider setting aside a couple of hours this week to read the terms and conditions of bank capital instruments. Maybe your investment in capital securities of EU banks is at risk, maybe not.… Read More Homework for the upcoming week: EU bank capital rules.
Shortly after EBA, the BOE published its own stress test definition. From the announcement: “A key threshold for the UK variant test will be set at 4.5% of Risk Weighted Assets (RWAs), to be met with Common Equity Tier 1 (CET1) capital in the stress – using a CRD IV end-point definition of CET1 in line… Read More And BOE follows with details of UK stress test
The European Banking Authority (EBA) released today its methodology and macroeconomic scenarios for the 2014 EU-wide stress test. While the extensive process of banks’ balance sheet repair is already underway, the test, designed to assess banks’ resilience to hypothetical external shocks, will identify remaining vulnerabilities in the EU banking sector and will provide a high… Read More Jay! EBA publishes the 2014 EU-banks stress test methodology
The European Central Bank (ECB) published a detailed manual providing guidelines for authorities and their third-party supporters in carrying out on-site inspection aimed at checking the quality of the biggest banks’ assets in the bloc. Click here for the manual. Or here if the first link does not work. Click here for the Comprehensive Assessment… Read More Jay! The ECB’s AQR manual is out
Both Basel and EBA published the mid-year 2013 Basel III monitoring results. The monitoring rounds show how banks are converging toward the Basel III end-state. EBA’s main findings show that the Common Equity Tier 1 capital ratio (CET1) of the largest internationally-active European banks (Group 1 banks) would be on average 9.1% compared to a ratio of 12%… Read More EBA and BCBS publish Basel III monitoring results
With no analysis from my own yet: The European Banking Authority (EBA) announced today the key components of the forthcoming 2014 EU-wide stress test that will be conducted on a wide sample of EU banks. The objective of the EU-wide stress tests is to help supervisors assess the resilience of financial institutions in the European… Read More EBA announces key features of the 2014 EU-wide Stress Test
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