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Better prepared banks suffered less from new accounting rules: ECB
November 24, 2017 / 2:38 PM / 17 days ago

Better prepared banks suffered less from new accounting rules: ECB

FRANKFURT (Reuters) - Euro zone banks better prepared to adapt new accounting rules called IFRS 9 suffered a more modest reduction in their capital from the changed standards, the European Central Bank said on Friday.

An employee inspects a 20 cent euro coin after it was minted at the"Monnaie de Paris" national mint factory in Pessac near Bordeaux, southwestern France, October 30, 2014. REUTERS/Regis Duvignau

In the first quarter of the year, bigger banks that were considered best prepared for IFRS 9 had their regulatory Common Equity Tier 1 capital reduced by about 40 basis points, the ECB said in a statement.

“This impact is lower than the average impact for the entire sample of significant institutions covered by the thematic review,” the ECB said, referring to the new rules, which will be applied to next year’s stress test for the first time.

In case of less significant institutions, the negative impact was 59 basis points for better prepared banks, the ECB added.

Reporting by Balazs Koranyi

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