In December 2022, the Estonian FSA presented Bigbank AS with the outcome of the annual Supervisory Review and Evaluation Process (SREP) capital adequacy calculation. As an outcome of the evaluation the FSA decided to establish new Pillar 2 capital requirement and guidance for Bigbank AS.
According to the decision of the FSA, an additional requirement for own funds (P2R) in the amount of 4.49% from the total risk exposure amount (TREA) applies to Bigbank AS on concolidated bases, of which at least 3.37% must be covered with Core Tier 1 own funds and at least 2.52% with Tier 1 capital. The 4.49% Pillar 2 capital requirement is the same ratio what was applicable to Bigbank AS as well before the decision. The total SREP capital requirement for Bigbank AS amounts thus to 12.49%. This is the sum of the total Pillar 1 requirement of 8% and the Pillar 2 requirement of 4.49%.
In addition, the FSA has decided to raise the Pillar 2 guidance (P2G), applicable to Bigbank AS on consolidated bases, from 0.5% to 1.5% from the TREA. The new P2R and P2G ratios are applicable from 15.03.2023. This means that from 15.03.2023 Bigbank AS has to have more capital for the same risk position.
Bigbank AS (www.bigbank.eu) is an Estonian capital-based bank specialised in loans and deposits for private and business customers. In addition to operations in Estonia, the bank has branches in Finland, Sweden, Latvia, Lithuania, and Bulgaria and offers its products in the form of cross-border services also in Austria, Germany, and the Netherlands. Bigbank’s balance sheet total is more than 1.5 billion euros.
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