December 6, 2017 / 9:23 AM / a year ago

NordLB says needs to bolster capital buffers

HANOVER, Germany, Dec 6 (Reuters) - German state-backed lender NordLB said it needs to bolster its capital buffers as it continues to suffer from high writedowns linked to its exposure to the ailing ship industry.

“For our business model we would at least need a core equity tier 1 ratio in the 13 percent range,” Chief Executive Thomas Buerkle said late on Tuesday, adding that no capital increase was planned in the short term.

“The market expects more, the rating agencies and our owners expect more,” Buerkle said, adding that there were also signals from the financial regulator that capital buffers needed to be bumped.

NordLB currently has a CET1 ratio of 12 percent.

Buerkle added that he expects the bank to decide in January on a sale of its Deutsche Hypo unit, proceeds of which would also bolster NordLB’s capital cushions. (Reporting by Klaus Lauer; Writing by Arno Schuetze)

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