Smaller European banks would lose more capital than their bigger peers in a stress scenario but would still maintain higher capital levels than the bloc’s biggest lenders, the European Central Bank said on Friday.
The 51 medium-sized banks tested solely by the ECB showed an average capital depletion of 6.8 percentage points to 11.3% from 18.1% under the harshest scenario spanning three years to 2023, the ECB said in a press release.
The smaller banks were excluded from a stress test by the European Banking Authority. Bigger banks, tested by the EBA, meanwhile, showed 4.85 percentage point drop in Common Equity Tier 1 capital to 10.2% from 15%.
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