Norwegian regulator wants more banks considered systemically important (updated)

Sparebanken Ost

19/10/2018 16:50

(Adds detail)
    OSLO, Oct 19 (Reuters) - More Norwegian banks should be
considered systemically important and be subject to higher
capital requirements, the country's financial regulator said on
Friday.
    They should include lenders with a share of 10 percent or
more in their local market, such as Sparebanken Vest  SVEG.OL ,
SR Bank  SRBANK.OL  and Sparebanken Oestlandet  SPOLT.OL , the
Financial Supervisory Authority (FSA) said.
    The aim is to ensure that banks remain resilient during a
downturn, and thus able to continue to lend when the economy
weakens, the regulator said.
    A final decision will be made by Norway's finance ministry.
    Other banks that should be considered systemically important
include Sparebanken Soer  SORR.OL , Sparebank 1 SMN  MING.OL ,
Sparebank 1 Nord-Norge  NONG.OL , Sparebanken Oest  SPOG.OL  and
Sparebank 1 Finans Midt Norge, the FSA said in a statement.
    Currently, only DNB  DNB.OL , the country's largest bank and
a major lender to the oil and gas sector, and Kommunalbanken
 KOMBK.UL , a state-owned bank that provides financing for
Norwegian municipalities, are considered systemically important.
    When a bank is named systemically important, it faces an
additional risk-adjusted core capital requirement of two
percentage points on top of its remaining core capital, the FSA
said.
    On an unadjusted basis, the requirement amounts to 1
percentage point, it said, adding that a pending implementation
of so-called minimum requirements for own funds and eligible
liabilities (MREL) could add further demands.

 (Reporting by Gwladys Fouche, editing by Terje Solsvik and
Susan Fenton)
 ((gwladys.fouche@tr.com; +47 23 31 65 94; Reuters Messaging:
gwladys.fouche.reuters.com@reuters.net; Twitter handle:
@gfouche))