Slovenian Banking Sector: Equity Capital Base Improves

Businessn.a. ♦ Published: August 3, 2013; 14:31 ♦ (Vindobona)

The banking system’s overall capital adequacy improved last year to 11.9% on average. The banks primarily focused on improving their core Tier 1 capital ratio, which was up 1.1 percentage points to stand at 10%.

Slovenian Banking Sector: Equity Capital Base Improves / Picture: © Vindobona.org

The increase in the ratios was attained primarily by a reduction in capital requirements, via a contraction in lending activity and reallocation to lower-risk investments, while the operating loss reduced the ratios. Here it should be noted that Slovenian banks use significantly higher risk weights for investments, and therefore have larger capital requirements than in the euro area…