Getin Noble Bank informed on Friday in the current report o violations as of January 1, 2022 of the Common Equity Tier 1 ratio (according to the bank’s estimates, it amounted to 4.2% as compared to the 4.5% required by law) and the level of the leverage ratio (2.74% as compared to the required 3% ).
Among the reasons, the bank lists additional burdens on own funds as a result of, inter alia, another amortization tranche of the impact of the implementation of IFRS (accounting standard), changes in amortization rates, further revaluation of securities in the bank’s portfolio (as a result of interest rate increases by the MPC) or a significant increase in the Swiss franc exchange rate.
As reported by the bank, due to the drop of the above-mentioned ratios below the required level, the bank – in accordance with the legal obligation – informed the Polish Financial Supervision Authority about the occurrence of the risk of bankruptcy.
The bank also announced that at the end of March this year. the indicated indicators were at an even lower level.
According to the data held by the Bank at the time of publication of this report, i.e. as at March 31, 2022, the Common Equity Tier I ratio is 0.14%. (on an individual basis) and 0.51 percent. (on a consolidated basis), while the leverage ratio is 0.09%. (on an individual basis) and 0.34 percent. (on a consolidated basis)
– we read in the bank’s report.
The bank’s representatives also informed that luka capital – depending on whether it concerns the basic ratio or the total requirement – is PLN 1.4-2.2 billion. However, the total capital gap – the one that would make the solvency ratio compliant with all the requirements – is as much as PLN 4.5 billion.
Getin Noble Bank also reported on Friday about the creation of a reserve for franc matters in the amount of approx. PLN 882 million (against 300 PLN million earlier).
Getin Bank has submitted a new recovery plan
In subsequent Friday’s current reports, Getin Noble Bank also announced the submission of a new recovery plan to the Polish Financial Supervision Authority in April, which provides for the rebuilding of the bank’s capital ratios by 2027.
In December 2021, the Polish Financial Supervision Authority rejected the earlier Getin Noble Bank recovery plan and called for the preparation of a new one. She also introduced a curator to the bank – it became the Bank Guarantee Fund.
Getin Noble Bank also announced on Friday that in 2021 its net loss amounted to PLN 1.07 billion (compared to about PLN 560 million a year earlier). In the first quarter of 2022, the group’s net profit amounted to PLN 18.6 million.
The bank hopes for a significant increase in interest income, among others in the positive impact of interest rate increases. Within 12 months, they may reach PLN 620-740 million. – The increase in interest rates gives us space for the bank’s profits to be significant – said President Artur Klimczak.
Getin Bank down sharply on the WSE
In the face of new information the company is not surprised by the nervous reaction of investors to the Warsaw one the stock exchange. Getin Noble Bank’s shares lost well over 30 percent on Friday. (as at 16:45 is 39 percent negative).
