ABN AMRO remains substantially above the stress test threshold of 5% Core Tier 1 ratio as defined by EBA1. Under the adverse scenario, Core Tier 1 ratio would be 9.2% at year-end 2012, compared with 9.9%2 at year-end 2010.
- ABN AMRO remains substantially above the stress test threshold of 5% Core Tier 1 ratio as defined by EBA1
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Under the adverse scenario, Core Tier 1 ratio would be 9.2% at year-end 2012, compared with 9.9%2 at year-end 2010
The EU-wide stress test, carried out across 90 banks covering over 65% of the total assets in the EU banking system, seeks to assess the resilience of European banks to severe shocks and of their specific solvency to hypothetical stress events under certain restrictive conditions.
The assumptions and methodology were established to assess banks’ capital adequacy against a 5% Core Tier 1 capital benchmark as defined by EBA. The purpose of the test is to restore confidence in the resilience of the banks tested. The adverse stress test scenario was set by the ECB and covers a twoyear time horizon (2011-2012). The stress test has been carried out using a static balance sheet assumption3 as at December 2010. The stress test does not take into account future business strategies and management action and is not a forecast of ABN AMRO profits.
Under the adverse scenario, the estimated consolidated Core Tier 1 capital ratio of ABN AMRO as defined by EBA would be 9.2% in 2012, compared with 9.9%2 at year-end 2010.
The EU-wide stress test requires that the results and weaknesses identified, which will be disclosed to the market, are acted on to improve the resilience of the financial system. The results of the EU-wide stress test show that ABN AMRO meets the capital requirement set out for the purpose of the stress test. The bank will continue to ensure that an appropriate capital level will be maintained. This stress test is in addition to the risk management procedures and regular stress testing programmes set up at ABN AMRO.