Landesbank Baden-Württemberg (LBBW) has successfully passed the Europe-wide stress test. In the so-called baseline scenario, LBBW achieved a common equity Tier 1 ratio of 12.29 percent. In the adverse scenario, which modeled among other things a sharp economic slump together with perceptible financial market upheaval, the Bank reached a common equity Tier 1 ratio of 7.42 percent. The minimum figure of 5.5 percent in the adverse scenario stipulated by the ECB was thus substantially exceeded.
"The result confirms that LBBW's capitalization is solid and that its resistance to stress is high", stated Hans-Jörg Vetter, Chairman of LBBW's Board of Managing Directors. "The Bank has a respectable safety buffer even under the assumptions of the adverse scenario. The systematic risk reduction over the past few years has thus proven to be correct. We now have sufficient scope to develop our customer-driven business model further."