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Economic Stress Test

Finnish Banks Pass Stress Tests With Flying Colours

As expected, Finland's OP-Pohjola Group got a clean bill of health in EU bank stress tests. Also Nordea Bank Finland and Sampo Bank which were tested as a part of their international groups were judged able to preserve a high level of solvency in the face of any new economic crisis.

Euron logo Euroopan keskuspankin edustalla Frankfurt Mainissa Saksassa.
Image: Uwe Anspach / EPA

The OP-Pohjola Group showed a Tier 1 capital ratio set at 12.3 percent. The target benchmark for the health of tested throughout the EU was a minimum of 6 percent. The Tier 1 capital ratio is the measure of a bank's capital adequacy, consisting of equity, preferred shares and retained earnings.

Nordea Bank Finland and Sampo Bank were evaluated as parts of the Nordea Group and the Danske Bank Group, respectively. Nordea's Tier 1 capital ratio was evaluated at 10.1 percent and that of Danske Bank at 10.0 percent.

Financial authorities say that on the basis of these stress tests, no special measures are needed to ensure the solidity of Finnish banks.

Ninety one banks were tested for extreme potential capital scenarios by the Committee of European Banking Supervisors (CEBS) during June and July.

Sources: YLE