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Capital ratios at Europe's largest banks, Q2'19

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Capital ratios at Europe's largest banks, Q2'19

Most big European banks experienced quarter-over-quarter growth in their fully loaded common equity Tier 1 ratios in the second quarter, with Italy's Banco BPM SpA posting the biggest increase, according to data from S&P Global Market Intelligence.

Among the sample of 35 banks, 22 reported a positive change in their CET1 ratios, with Spain-, Italy- and France-based institutions posting the biggest increases.

The metric quantifies a bank's CET1 capital as a percentage of risk-weighted assets. Banks in Europe must have a fully loaded CET1 ratio of at least 7% from 2019 onward under Basel III conditions, comprising a minimum 4.5% common equity Tier 1 ratio and a 2.5% capital conservation buffer. Certain banks might be susceptible to supplementary local capital buffer obligations.

Russia-based VTB Bank PJSC and Spain's Banco de Sabadell SA reported the lowest ratios at 10.79% and 11.16%, respectively.

Meanwhile, Banco BPM, with a ratio of 11.92%, saw the greatest quarterly increase of 141 basis points. In contrast, Finland-based OP Financial Group experienced the largest decline in its ratio, losing 70 basis points for the three months.

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