Hellenic Bank’s main capital ratios will be far above the average of Eurozone’s systemic banks after the approval by the European Central Bank (ECB) of the Cypriot lender’s third quarter profits for 2018 and the imminent capital increase.
Based on Hellenic Bank’s updated data, the CET1 index will be considerably improved together with the Tier 1 capital ratio and the Capital Adequacy Index. The CET1 capital ratio will reach 17.77% from 14.73%, the Tier 1 capital ratio will increase to 20.4% from 17.36%, and the Capital Adequacy Ratio will grow from 17.36% also to 20.4%.
It should be noted that the average capital ratios of systemic banks in the euro area in the third quarter of 2018 were as follows: CET1 at 14.18%, Class 1 Tier 1 at 15.4% and the Capital Adequacy Ratio at 17.83%. Based on the latest report by the Single Supervisory Mechanism on Cyprus’ systemic banks, the main indicators’ performance in the third quarter of 2018 were as follows: CET1 (12.45%), Class 1 (13.04%) and the Capital Adequacy Ratio (14.15%).
For Hellenic Bank, the minimum regulatory requirements that have been in place by the Single Supervisory Mechanism since January 1, 2019 are as follows: CET1 10.575%, Capital Index Class 12.075%, and Capital Adequacy Ratio 14.075% .
Following ECB’s approval and the issuance of Hellenic Bank’s Prospectus, the process for its share capital to be increased by 150 million euros is expected to be completed by the end of March.
Meanwhile, the transfer of good assets of the Co-operative Bank of Cyprus to Hellenic and the transfer of non-performing loans of the Co-op outside the banking sector has decreased significantly the percentage of NPLs in the systemic banks of Cyprus which stood at 20% in the third quarter of 2018.