NLB

Capital/Financing Update • Nov 29, 2019

Category: Inside information

Published on: SEOnet

Published at:  28.11.2019 19:00

Published document ID: INI-800/19

INI-789/19

NLB, d. d., Ljubljana

NLB d.d., Ljubljana discloses new ECB capital requirements

NLB d.d., Ljubljana has received new decision establishing prudential requirement from ECB, which is applicable from 1st January 2020, leading to total SREP capital requirement (TSCR) of 10.75%, that includes minimum own funds of 8% (P1R) and own funds requirement of 2.75% (P2R) to be held in excess of minimum own funds requirement on consolidated level.

Following the Supervisory Review and Evaluation Process (SREP), the ECB has formally notified NLB d.d., Ljubljana of its decision to decrease:

the pillar 2 requirement (P2R) from 3.25% to 2.75% CET1.

This decision together with applicable combined buffer requirement leads to overall capital requirement of 14.25%. More details on the composition of the new capital requirements can be found in the table below:

SREP requirement		2017	2018	2019	2020
Pillar 1 (P1R)	CET1	4.50%	4.50%	4.50%	4.50%
Tier1	6.00%	6.00%	6.00%	6.00%
Total capital	8.00%	8.00%	8.00%	8.00%
Pillar 2 (P2R)	CET1	3.50%	3.50%	3.25%	2.75%
Total SREP Capital Requirement (TSCR)	CET1	8.00%	8.00%	7.75%	7.25%
Tier 1	9.50%	9.50%	9.25%	8.75%
Total capital	11.50%	11.50%	11.25%	10.75%
Combined Buffer Requirement (CBR)
Conservation buffer	CET1	1.25%	1.88%	2.50%	2.50%
O-SII buffer	CET1	0%	0%	1.00%	1.00%
Countercyclical buffer	CET1	0%	0%	0%	0%
Overall capital requirement (OCR) = MDA threshold	CET1	9.25%	9.88%	11.25%	10.75%
Tier 1	10.75%	11.38%	12.75%	12.25%
Total capital	12.75%	13.38%	14.75%	14.25%

Recommendation on Pillar 2 capital guidance:

Based on findings stemming from supervisory stress tests conducted in 2018, the ECB expects Nova Ljubljanska banka d.d. Ljubljana to adhere on a consolidated basis, to the Pillar 2 capital guidance of 1.00%, which should be comprised entirely of CET1 capital and held over and above the overall capital requirement (OCR).

This announcement will be available on the Bank's website (www.nlb.si) as of 28 November 2019.

Investor relations,

NLB d.d., Ljubljana

Date: 29.11.2019