Published: 2016-10-20 08:00:00 CEST
LHV Group
Company Announcement

Outcome of SREP and AS LHV Group internal capital targets

At the end of September Estonian FSA, Finantsinspektsioon presented to LHV Group and LHV Bank regular yearly outcome of Supervisory Review and Evaluation Process (SREP), which sets additional capital requirements for capital adequacy calculation. In comparison with last year there is an addition to total capital requirement, as there have also been defined capital charges for Core Tier 1 and Tier 1 capital.

According to the decision of FSA LHV Group should on consolidated level keep in additional capital in the amount of 1,89% (last year 1,50%), from which at least 0,74% should be covered by Core Tier 1 capital and at least 0,99% should be covered by Tier 1 capital.

In a regular council meeting on 19 October the supervisory board of LHV Group based on the FSA decision and adding to that internal buffers decided to set total CAD target ratio at 16,19% (previously 16,20%) and Tier 1 ratio at 13,29% (previously 12,70%).

Underneath is the target split into components:

Component Tier 1 Total CAD
Base requirement 6,00% 8,00%
Capital conservation buffer 2,50% 2,50%
Systemic importance buffer 1,00% 1,00%
Discretionary counter-cyclical buffer 0,00% 0,00%
Pillar II additional capital charge (SREP) 0,99% 1,89%
Internal risk scenario buffer 1,60% 1,60%
Internal systemic importance buffer and volatily buffer for country-based buffers 1,20% 1,20%
  13,29% 16,19%

 

         Priit Rum
         Communication Manager
         Telephone: +372 502 0786
         Email: priit.rum@lhv.ee