NLB

Capital/Financing Update • Feb 15, 2019

Category: Inside information

Published on: SEOnet

Published at:  14.02.2019 18:00

Published document ID: INI-67/19

INI-69/19

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 March 2019, leading to total SREP capital requirement (TSCR) of 11.25%, that includes minimum own funds of 8% (P1R) and own funds requirement of 3.25% (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 3.5% to 3.25% CET1

This decision together with applicable combined buffer requirement leads to overall capital requirement of 14.75%. More details on the composition of the new capital requirements can be found in the table below:

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

As at 30 September 2018, NLB Group’s CET 1 ratio stood at 16.9%, which is above the new SREP requirement. NLB Group intends to maintain additional Management Buffer above the regulatory requirements. Currently communicated mid-term Total Capital Target of around 17% will be regularly revised by competent bodies to reflect each time applicable capital requirements.

This announcement will be available on the Bank's website (www.nlb.si) as of 14 February 2019.

Investor relations,

NLB d.d., Ljubljana

Date: 15.02.2019