ECB Capital Requirements for Crédit Agricole Unchanged for 2020
The European Central Bank (ECB) has confirmed Crédit Agricole Group and Crédit Agricole S.A.'s capital requirements for 2020, setting them at the same levels as the previous year.
The European Central Bank (ECB) has notified Crédit Agricole Group and Crédit Agricole S.A. of their capital requirements following the Supervisory Review and Evaluation Process (SREP). For 2020, the Pillar 2 requirement (P2R) remains unchanged at 1.5% for both Crédit Agricole Group and Crédit Agricole S.A.
From January 1, 2020, Crédit Agricole Group must maintain a Common Equity Tier 1 (CET1) ratio of at least 9.7%, including Pillar 1 and Pillar 2 capital requirements, as well as applicable buffer requirements. Crédit Agricole S.A. must adhere to a CET1 ratio of at least 8.7%.
At the end of September 2019, Crédit Agricole Group's CET1 ratio stood at 15.5%, significantly above the minimum required level. Crédit Agricole S.A.'s CET1 ratio was 11.7% for the same period, also well above its required threshold and Medium Term Plan target.
A recent Conseil d’Etat decision regarding Emporiki bank will lead to a provision write-back in the fourth quarter of 2019, positively impacting pro-forma capital ratios. Crédit Agricole Group's pro-forma CET1 ratio would be 15.7% and Crédit Agricole S.A.'s 12.0% as of end-September 2019. Given its strong capital position, Crédit Agricole S.A. intends to begin dismantling the Switch guarantee mechanism in early 2020.