Decision on BankNordik’s MREL

Announcement no. 29/2019

The Danish Financial Supervisory Authority (FSA) has decided on BankNordik’s minimum requirement for own funds and eligible liabilities (MREL). The FSA assigns an MREL requirement of 30.5% of the Group’s risk-weighted assets as per year-end 2018, phased in from 2020-2025. BankNordik expects to cover the bulk of the MREL add-on by issuing Tier 3 capital.

 

This decision is in line with the preliminary principles for MREL for Faroese banks, published by the FSA on 27 June 2018, in which the MREL is set to be equivalent to two times the capital requirement, including all capital buffer requirements with the exception of the systemic risk buffer in the Faroe Islands and the countercyclical buffer in Denmark. The FSA updates the MREL requirement annually and the conclusion will be published on BankNordik’s website here (in Danish only).

 

BankNordik currently targets a CET1 ratio of 17% and a total capital ratio of 20%. In light of the FSA’s decision, BankNordik will review its long-term capital plan with consideration to the MREL requirements and the details will be laid out in the annual report 2019 on 27 February 2020.

 

Further information:

Árni Ellefsen, CEO, tel. (+298) 230 348

 

BankNordik has banking activities in Denmark, Greenland and the Faroe Islands and insurance activities in the Faroe Islands. Founded in the Faroe Islands more than a century ago, the Group has total assets of DKK 17.7bn and 383 employees. The Bank is subject to the supervision of the Danish Financial Supervisory Authority and is listed on Nasdaq Copenhagen.