Polish banks' Tier 1 capital shortfall likely at PLN 5.7 bln in shock scenario - c. bank
In a shock scenario, at the end of 2027, Polish commercial banks with 3 percent of the sector's assets would fail to meet Pillar I and II capital standards and the combined buffer requirement together, with a total Common Equity Tier 1 capital shortfall of PLN 5.7 billion (EUR 1.3 bln), Poland's central bank NBP said in the newest financial stability report.
In contrast, commercial banks with a 4 percent share of the sector's assets would fail to meet the Pillar I and II capital standards, the MREL-RCA requirement and the combined buffer requirement together, with a total Common Equity Tier 1 capital shortfall of PLN 6.2 billion (EUR 1.45 bln).
"If the shock scenario materialises, few banks would fail to meet the capital requirements at the end of the analysis horizon as a result of incurring losses that reduce own funds," the National Bank of Poland said in the report.
"However, the amounts of missing capital on a sector-wide basis would be small. By contrast, in the reference scenario, capital shortfalls would be negligible (less than PLN 0.1 billion)," it added.
Poland's central bank NBP took into account two scenarios of economic developments in the period from the first quarter of 2025 to the end of 2027.
The analysis was conducted for two scenarios - a reference and a shock scenario.
The reference scenario used the Poland's central bank NBP macroeconomic projection path from the March report on inflation. The shock scenario was developed using a model used to prepare Poland's central bank NBP macroeconomic projections and historical trajectories of macroeconomic variables for periods of financial crises in other countries.
pel/ ao/ nl/
