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FRANKFURT - Commerzbank (ETR:CBKG) has demonstrated its financial resilience in the European Banking Authority’s (EBA) 2025 stress test, improving upon its previous performance despite facing extraordinarily challenging macroeconomic scenarios.
In the adverse scenario, Commerzbank maintained a Common Equity Tier 1 (CET1) ratio of 9.6% at the end of the three-year stress test horizon in 2027, slightly better than the 9.5% recorded in the 2023 test. The bank’s CET1 ratio decreased by 412 basis points over the stress period, compared to a 464 basis point drop in the previous assessment.
Under the transitional regime, which accounts for EU regulations applicable during the simulation period, the bank’s CET1 ratio fell by 484 basis points to 10.5% by the end of 2027.
"We have once again improved our result in this year’s EBA stress test in an extraordinarily challenging macroeconomic scenario," said Bernd Spalt, Chief Risk Officer at Commerzbank. "This is evidence of Commerzbank’s high resilience and highlights our profitability."
The adverse scenario used in the test assumed a severe recession in Germany with a cumulative decline in gross domestic product of 7.5% over three years, more severe than the 6.4% drop modeled in the 2023 test. The scenario also included increased inflation due to massive energy price shocks, particularly affecting export-oriented and energy-intensive sectors.
The stress test was conducted based on financial figures as of the end of 2024 using a static balance sheet assumption, without considering current or future business strategies. Results from the test will feed into the Supervisory Review and Evaluation Process (SREP).
According to the press release statement, the improved performance demonstrates the bank’s ability to withstand severe economic downturns while maintaining adequate capital buffers.
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