European Central Bank Raises Minimum Capital Requirements for Spanish Banks – SREP Assessment and Solvency Thresholds

2023-12-01 08:52:00

The European Central Bank has raised minimum capital requirements for Spanish banks BBVA, Caixabank, Sabadell and Bankinter as part of a Supervisory Review and Evaluation Process (SREP).

This process provides an overall assessment of the challenges facing significant institutions, as well as the corresponding solvency requirements and other supervisory measures that banks are expected to meet for the coming year. On Friday, Caixabank, the country’s largest lender by domestic assets, said the supervisor had set a minimum threshold of 8.58% for its strictest measure of solvency, or Common Equity Tier 1 (CET1). , for 2024, compared to the 8.44% set a year ago by the ECB.

BBVA’s capital threshold has also been raised from 8.72% to 9.09% for next year.

The new requirement takes effect January 1, 2024.

In the case of Sabadell, the fourth bank in the country in terms of market value, the solvency threshold was raised by the ECB from 8.65% to 8.93%, while it went from 7.726% to 7.802 % in the case of Bankinter.

For Unicaja, however, the supervisory authority kept its solvency threshold for 2024 unchanged at 8.27% compared to 2023.

Spanish bank Santander has still not disclosed its regulatory requirements. (Reporting by Jesús Aguado; Writing by Emma Pinedo and Sharon Singleton).

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