EBA stress test: Erste Group confirms capital shortfall of EUR 743 million at Q3 2011

The European Banking Authority (EBA) today published the final results of its stress test, which was conducted in connection with the sovereign debt crisis, amongst 71 European banks based upon the third quarter 2011. rnrnA core tier 1 ratio of 9% (as per the stress test definition) was set as a benchmark and will have to be met by 30 June 2012.rnrnAccording to the EBA calculation, Erste Group Bank AG requires additional capital amounting to EUR 743 million, thus confirming our estimated figure published with the Q3-results, said the bank in a press release. rnrnErste Group will meet this requirement through retained earnings and selective disposal of non-core assets, but without anyrngovernment support.rnrnBased on the same EBA methodology and estimates, Erste Group’s core tier 1 ratio reached 8.4% at third quarter 2011. rnrnUnder the EBA calculation, the core tier 1 ratio includes the participation capital provided by the Republic of Austria in the amount of EUR 1,224 million, but excludes the hybrid capitalrnand the participation capital provided by private investors in the amount of EUR 540 million. rnrnAlso, all EEA sovereign exposures taken into account are marked-to-market.