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Börse Express – Stress Test – BAWAG sees itself well capitalized / Bank slips to 12.00 per cent with solid capital in stress test scenario

BAWAG sees itself well capitalized after the publication of the European Bank’s stress test. In the stress test scenario, the bank’s core capital ratio (CET1) after three years will decline from 13.98% at the end of 2020 by 198 basis points to 12.00%. The bank asserts that the 3-year impact on the CET1 ratio of -198 basis points is good compared to the EBA banks’ average of 485 basis points and the European Central Bank’s average of 520 basis points.

89 Eurozone banks were included in the stress tests. For 38 banks – from Austria Erste Group and Raiffeisen Bank International (RBI) – the test was conducted under the guidance of the EBA, for the remaining banks (from Austria BAWAG, RLB OÖ, Volksbanken and Sberbank) under the auspices of the European Central Bank.

According to BAWAG, the assumptions in the 2021 stress test were more stringent than in the 2018 stress test. For the BAWAG group, the negative effect after three years in this year’s stress test was -198 basis points, while the negative effect in the 2018 stress The test was -240 bp. This includes dividends as per the dividend policy, where one would have made profits in the second and third year and the capital was well above the minimum requirements.

Anas Abuzaqouk, CEO of BAWAG, explains in a press release: “Regular theoretical stress testing scenarios provide additional information that once again demonstrates the resilience of our business model, our conservative approach to risk and our disciplined underwriting. Building on our transformation, the BAWAG Group is able by generating strong capital In a normal environment, dealing with stress scenarios while continuing to maintain a well-capitalized balance sheet.”

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According to the results published by the EBA on Friday evening, the capital ratio (CET1) of financial institutions in Europe will shrink to 10.3% in a crisis-simulated scenario in 2023, compared to 15.3% in 2020. Along with a solid core capital ratio of 9.22 percent of the endurance test. On average, Italian banks reach a core capital ratio of 8.6 percent in the 2023 stress scenario.

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