Banks provided flexibility in additional capital requirements to ensure continuity of operations in response to coronavirus (COVID-19)

The Finnish banking sector will face the risks caused by the coronavirus epidemic with strong capital buffers. The FIN-FSA continues to monitor the situation and banks’ contingency measures to address possible effects of the coronavirus in the domestic banking sector.

The FIN-FSA points out that the own funds that Finnish banks under the direct supervision of the ECB or FIN-FSA can use to fulfil the Pillar 2 additional capital requirement are, however, provided by law. The other measures provided by the ECB are also available to banks directly supervised by the FIN-FSA, if necessary.

In addition, the European Banking Authority (EBA) wants to let banks to focus on and ensure continuity of their core operations and so, has decided to postpone the EU-wide stress test exercise until 2021. In line with the decision by the EBA, the FIN-FSA has decided to postpone to 2021 the stress test exercise of banks under its direct supervision.

Of the credit institutions operating in Finland, the entities directly supervised by the ECB are Nordea Bank Abp, OP Financial Group and Municipality Finance Plc.

Further information:

ECB Banking Supervision press release: https://www.bankingsupervision.europa.eu/press/pr/date/2020/html/ssm.pr200312~43351ac3ac.en.html

European Banking Authority (EBA) press release:
https://eba.europa.eu/eba-statement-actions-mitigate-impact-covid-19-eu-banking-sector

For further information, please contact: Anneli Tuominen, Director General and Jyri Helenius, Deputy Director General.

Requests for interviews are coordinated by FIN-FSA Communications, tel. +358 9 183 5030, weekdays 9.00–16.00.

The corresponding Finnish-language press release was published on 12 March 2020.