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The Financial Supervisory Authority (FME) carries out an annual assessment of risk in the operations of systemically important financial institutions by means of a Supervisory Review and Evaluation Process (SREP). The process involves an assessment of the capital requirement for financial institutions which results in an additional capital requirement under Pillar II.

The conclusions of this annual process for Arion Bank have now been made available. The Bank shall maintain an additional capital requirement of 3.1% of risk-weighted assets, which is an increase of 0.2 percentage points from the previous assessment. The Bank’s total capital requirement, taking into account capital buffers, therefore increases from 19.8% to 20.0%. 

The increase in the countercyclical capital buffer for Icelandic financial institutions, as per FME’s decision in February 2019, comes into effect in February 2020, resulting in a capital requirement of 20.3%, if all other factors remain unchanged.

Attached is the transparency statement from the FME (translated by Arion Bank).

For further information please contact Theodór Friðbertsson, Head of Investor Relations, theodor.fridbertsson@arionbanki.is, tel. 354 444 6760 or Haraldur Gudni Eidsson, Head of Communications at haraldur.eidsson@arionbanki.is, or tel. 354 856 7108

• Transparency-SREP-AB-02102019