The FME has calculated the effects of simultaneous shocks on capital ratios of the largest Icelandic banks as described in Rules No 530/2004, with later amendments. The shocks implies that a financial undertaking must be in a position to take on certain setbacks that simultaneously may lead to changes in the value of shares, market bonds, non-performing/impaired loans and appropriated assets and the Icelandic krona without having its capital adequacy ratio drop below 8%.
The effects of aforementioned simultaneous shocks on capital ratio are following:
|
|
Kaupthing- banki hf. |
Glitnir banki hf. |
Lands- banki hf. |
Straumur Burdarás hf. |
|
Capital Ratio (CR) |
12.1% |
13.7% |
15.1% |
31.7% |
|
Thereof Tier 1 ratio |
8.7% |
9.1% |
12.9% |
30.2% |
|
Capital Ratio (CR) after stress test |
9.2% |
12.5% |
12.7% |
24.0% |
For further information contact: Ragnar Haflidason
The criteria used in the stress tests is available under this link.