Argenta has been notified of the European Central Bank’s decision on the 2016 Supervisory Review and Evaluation Process (SREP), leading to a fully loaded overall capital requirement of 9.75% common equity tier 1 ratio (CET 1) and 13.25% total capital ratio (TCR) for Argenta Spaarbank. This includes a pillar 2 requirement (P2R) of 2.0% CET 1, but excludes the non-mandatory pillar 2 guidance (P2G) which is not disclosed.
On 30 June 2016, Argenta Spaarbanks fully loaded CET1 (without taking into account the basel floor) stood at 24.8%, well in excess of the regulatory requirement.
In addition to the pillar 2 requirement of the ECB, the capital requirement is determined by decisions of the local competent authorities in the markets where Argenta is active. The National Bank of Belgium (NBB) announced additional capital buffers for Belgian systemic banks in 2016, that gradually increase over a 3-year period. This means a fully loaded O-SII1 buffer of 0.75% for Argenta Spaarbank. In addition, the fully loaded capital conservation buffer for Argenta Spaarbank equals 2.50%. Both buffers come on top of the pillar 1 minimum CET 1 requirement of 4.5%.
In total the fully loaded CET 1 requirement adds up to 9.75% and the fully loaded TCR equals 13.25%. Argenta clearly exceeds these requirements. Since the additional buffers imposed by the local competent authorities are gradually built up by 2019, the relevant requirement for 2017 on a phased-in basis is at 8.25% CET 1 and 11.75% TCR.
More details on the new capital requirements can be found in the attached presentation to this press release.