Budapest (MTI) – OTP Bank, the only Hungarian participant in the European Central Bank’s stress test, does not need to modify the Common Equity Tier 1 capital or any other parameters, as the review found negligible deficiencies only, the National Bank of Hungary (NBH) said after the European Banking Authority (EBA) published the results of the stress test on Sunday.
The test is aimed at assessing the resilience of participating European banks on a three-year horizon under a hypothetically adverse macroeconomic scenario using a common methodology developed by the EBA. From Hungary, it was OTP Bank taking part in the 2014 stress test as OTP Bank is the prominent representative of the local financial sector with a market share exceeding 25 percent in terms of total assets. Through its subsidiaries, OTP Bank is present in eight different countries in the CEE region.
With respect to the capital position, which is the most important result of the stress test, OTP Bank demonstrated strong results. The NBH noted that the losses stemming from the provisions of the Settlement Act were not taken into account by OTP Bank, but were indicated in the tables to be published by the EBA.
The European banks with substantial Hungarian units passed the ECB’s stress test with the exception of Belgium’s AXA Bank Europe, which has already raised its capital.
The review found that all other European banks with Hungarian subsidiaries, Austria’s Erste Bank and Raiffeisen Bank, Belgium’s KBC Group, Germany’s Commerzbank and Deutsche Bank, France’s BNP Paribas, Italy’s Intesa Sanpaolo and UniCredit and the Dutch ING Bank all had Common Equity Tier 1 capital ratios meeting the required level.