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FRANKFURT - Commerzbank AG (OTC:CRZBY) (ETR:CBK) has maintained its capital requirements as per the latest Supervisory Review and Evaluation Process (SREP) conducted by the European Central Bank (ECB), according to a press release issued by the bank. The ECB has confirmed that the bank-specific capital requirements for Commerzbank (ETR:CBKG) for the year 2025 will remain unchanged, ensuring a stable outlook for the bank's regulatory capital demands.
The Pillar 2 capital requirement (P2R) stays at 2.25%, with the additional own funds requirement for the leverage ratio, also known as SREP P2R-LR, holding steady at 0.1%. The bank's Maximum Distributable Amount (MDA) threshold for Common Equity Tier 1 (CET1) pro forma is set at 10.31% of risk-weighted assets (RWA).
As of September 2024, Commerzbank reported a CET1 ratio of 14.82%, significantly above the MDA threshold, which suggests a robust capital buffer. This financial position allows the bank to proceed with its plans for capital return to shareholders, with intentions to increase this return in the coming years.
The CET1 requirement for Commerzbank on a group level is composed of various buffers and requirements, including the CET1 minimum requirement of 4.5%, the P2R of 1.27%, and other buffers such as the capital conservation buffer and the countercyclical capital buffer.
Commerzbank CEO Bettina Orlopp expressed confidence in the bank's capital strength, stating, "With a CET1 ratio of 14.82% as of September 2024, we are well above the MDA threshold. This provides us with a comfortable buffer to continue to implement the return of capital to our shareholders.” The bank's strategic plan targets a CET1 ratio of 13.5% by 2027.
The announcement also reaffirmed that the leverage ratio requirement of 3.1% is comfortably met by the bank's reported leverage ratio of 4.4% as of September 2024. This information is based on a press release statement from Commerzbank.
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