European Banks Have 84 Billion Euro Capital Shortfall, OECD Estimates: Report
European banks have a combined capital shortfall of about 84 billion euros ($115 billion), German weekly WirtschaftsWoche reported, citing a new study by the Organisation for Economic Cooperation and Development (OECD).
French bank Credit Agricole (CAGR.PA) has the deepest capital shortfall at 31.5 billion euros, while Deutsche Bank (DBKGn.DE) and Commerzbank (CBKG.DE) have gaps of 19 billion and 7.7 billion respectively, the magazine reported in a pre-release of its Monday publication.
Financial regulators have been pushing banks to hold more capital to weather potential financial headwinds.
It was not clear whether the OECD had looked at the listed entity Credit Agricole S.A., which is less well-capitalized than its parent, Credit Agricole Group, an unlisted network of cooperative retail banks, which the Bank of France will regulate in terms of solvency ratios.
Although it used a different method of calculating the shortfalls, the OECD said it expected the European Central Bank would come to the same conclusion later this year in its audit and bank stress tests, the magazine quoted the study as saying.
The OECD and Credit Agricole could not be reached for comment outside regular business hours. Commerzbank and Deutsche Bank declined to comment.
Deutsche Bank said earlier this month its common equity tier 1 capital ratio was 9.7 percent while its leverage ratio had reached 3.1 percent as of December 31.
Credit Agricole, which will report fourth-quarter results on February 19, reported a core tier 1 ratio of 9.4 percent as of September 30, while Commerzbank had a core tier 1 ratio of 12.7 percent on that date.
Commerzbank is due to report its results on February 13.
(Reporting by Harro ten Wolde, Olaf Brenner in Frankfurt and Leila Abboud, Lionel Laurent in Paris; Editing by Hugh Lawson)