On 30 July 2021 the European Banking Authority (EBA) published the results of the EU-wide stress test conducted in cooperation with the European Systemic Risk Board (ESRB), the European Central Bank (ECB) and the European Commission (EC). The forward-looking analysis covers the period 2021-23 and considers the resilience of financial institutions to adverse economic shocks.
The exercise confirms Nordea’s resilient capital position. Under the severe stress scenario, with very tough and conservative assumptions for the Nordic countries, Nordea’s CET1 ratio is estimated to decline from 17.1% at year-end 2020 to 13.4% at year-end 2023. This would still be well above the capital requirements including the management buffer. The reported CET1 ratio as of end Q2 2021 was 18.0%.
The stress test results, scenarios and methodologies can be found on the website of the European Banking Authority: https://www.eba.europa.eu/.
The stress test results will not result in changes to Nordea’s capital planning or capital targets.