REG - Komercni Banka - Minimum Capital Ratio requirement as from 1.1.2024

Komercni Banka asAnnouncement

05/12/2023 16:45

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RNS Number : 7705V  Komercni Banka  05 December 2023

Komercni banka, a.s. http://www.kb.cz/en (http://www.kb.cz/en)

Prague 1, Na Prikope 33, building identification number 969, Post Code 114 07

Identification No.: 45 31 70 54

LEI Code: IYKCAVNFR8QGF00HV840

incorporated in the Commercial Register maintained with the Municipal Court in
Prague,

section B, insert 1360

Disclosed on  5 November 2023

The Information is available also at the following link:
https://www.kb.cz/en/about-the-bank (https://www.kb.cz/en/about-the-bank)

 

Regulatory information

 

Announcement on the Minimum Capital Ratio requirement as from 1 January 2024

 

Prague, 5 December 2023 - Komerční banka, a.s., with its registered seat at
Praha 1, Na Příkopě 33/969, Zip Code 114 07, Id. No. 45317054, registered
in the Commercial Register maintained by the Municipal Court in Prague,
section B, file No.1360 (hereinafter also Komerční banka or the Bank),
announces that

 

the Bank received information from Société Générale, a parent company of
Société Générale Group, on the minimum level of capital ratio set for
Komerční banka by the joint decision of the College of Supervisors of the
Société Générale Group.

 

According to this decision, Komerční banka is required to maintain a capital
ratio on a consolidated basis at the minimum level of 10.6% (TSCR - Total
SREP Capital Ratio) effective from 1 January 2024, representing a decrease
by 30 basis points in comparison with the ratio required today. This
requirement includes:

1. The minimum capital requirement under Article 92(1) of the EU Prudential
Regulation for credit institutions and investment firms, i.e., to maintain a
Common Equity Tier 1 (CET1) capital ratio of 4.5%, a Tier 1 capital ratio of
6% and a total capital ratio of 8%; and

2. The additional Pillar 2 Requirement (also known as P2R) of 2.6%, which KB
is required to hold above the minimum requirements under the previous point
and which it is required to cover with at least 56.25% common equity Tier 1
capital and 75% Tier 1 capital. The requirement to maintain additional capital
(so called Pillar 2 Guidance, also P2G) was not set for Komerční banka.

Moreover, credit institutions in the Czech Republic are simultaneously subject
to the combined capital requirements, which are additive to the TSCR
requirement set in the aforementioned joint decision. As of today, KB is
required to maintain a combined capital buffer comprising the capital
conservation buffer at 2.5%, the O-SII capital buffer at 2.0% and the
countercyclical buffer determined by competent authorities for exposures in a
particular country (currently at 2.0% in the Czech Republic while CNB
announced the requirement will remain unchanged as from 1 January 2024 as
well).

Thus, assuming no further changes in capital requirements, Komerční banka's
overall capital requirement as of 1 January 2024 will be approximately 17.1%
in relation to the volume of risk-weighted assets. The minimum Common Equity
Tier 1 capital ratio will stand at approximately 12.46% and the minimum Tier
1 capital ratio at approximately 14.45% in relation to the volume
of risk-weighted assets.

As of 30 September 2023, the overall consolidated capital ratio of Komerční
banka stood at 20.2% and the Common Equity Tier 1 ratio was 19.6%.

Komerční banka will continue to apply prudent assumptions about the future
development of regulatory capital requirements in its capital planning.

 

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