Capital requirement remains unchanged for NWB Bank

The European Central Bank has informed NWB Bank that the requirement for the bank specific Pillar 2 requirement will be kept unchanged at 2.25%. The capital requirement is effective on 1 January 2021.

Due to the ongoing pandemic, the ECB will this year not provide its Supervisory Review and Evaluation Process Decision (SREP Decision). Instead, the ECB has given NWB Bank an Operational Letter in which the Pillar 2 requirement imposed on NWB Bank last year is confirmed to be unchanged at 2.25%. The total SREP capital requirement for NWB Bank amounts to 10.25%. This is the sum of the total Pillar 1 requirement of 8% and the Pillar 2 requirement of 2.25%. The Overall Capital Requirement amounts to 12.75% if the capital conservation buffer is also added.

As of 30 June 2020, the Tier 1 capital ratio excluding profit for the year amounts to 56%. As such, NWB Bank’s capitalization is substantially above the ECB requirement.