PTA-News: Erste Group Bank AG: new MREL requirements for the Austrian resolution group

Wednesday, 25. May 2022 17:45

Business news for the stock market

Vienna (pta043/25.05.2022/17:45) - On 25 May 2022, the Austrian Financial Market Authority notified Erste Group Bank AG about its MREL requirement (Minimum Requirement for own funds and Eligible Liabilities) set by the Single Resolution Board (SRB) and calibrated on balance sheet data as of 31 December 2020 and the Bank Recovery and Resolution Directive 2 (BRRD2).

Erste Group Bank AG, as the resolution entity of the Austrian resolution group1, must comply with binding interim MREL requirements equivalent to 26.03% (excluding the Combined Buffer Requirement (CBR)) of the Total Risk Exposure Amount (TREA) and 9.34% of the Leverage Ratio Exposure (LRE) of the Austrian resolution group starting from 1 January 2022.

The binding MREL requirements on fully loaded basis, effective from 1 January 2024, are equivalent to 27.78% of TREA (excluding CBR) and 9.34% of LRE of the Austrian resolution group, respectively.

In addition, the minimum subordination requirements were set at a level of 15.78% of TREA (excl. CBR) and 8.43% of LRE, thereby specifying the amount of the total MREL requirements that must be met with subordinated instruments such as regulatory capital, subordinated debt and senior non-preferred debt.

The TREA of the Austrian resolution group as of 31 December 2020 (as applied by SRB for the MREL calibration) amounted to EUR 77.11 billion and LRE to EUR 187.25 billion.

The table below summarises the current MREL and subordination requirements:

Requirements for Austrian Resolution Group
based on December 2020 data
binding from 1 January 2022 binding from 1 January 2024
in % of TREA² in % of LRE in % of TREA² in % of LRE
Total MREL 26.03% 9.34% 27.78% 9.34%
Subordinated MREL 14.61% 8.43% 15.78% 8.43%

These requirements are in line with our expectations. Based on balance sheet data for the Austrian resolution group as of 31 December 2021 and SRB's 2021 MREL Policy, Erste Group Bank AG complies with the above-mentioned total MREL and subordination requirements, both on interim and fully-loaded basis.

The remaining MPE resolution groups (CZ, HR, HU, RO, SK) of Erste Group are going to announce their MREL requirements individually after receiving the respective notification letters.

1 MREL and subordination requirements do not apply to Erste Group's consolidated balance sheet, but to the Austrian resolution group comprising mainly Erste Group Bank AG, its direct Austrian subsidiaries and all Austrian Savings Banks. As the Austrian resolution group is not a legal entity or reporting unit, there is no statutory reporting nor a capital requirement at the consolidation level of the Austrian resolution group.

2 Excluding the Combined Buffer Requirement (CBR)


emitter: Erste Group Bank AG
address: Am Belvedere 1, 1100 Wien
country: Austria
contact person: Thomas Sommerauer / Gerald Krames
phone: +43 (0)50100-17326

ISIN(s): AT0000652011 (share)
stock exchanges: official trade in Vienna
other stock exchanges: Bucharest Stock Exchange, Prague Stock Exchange

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Related Links: Erste Group Bank AG