Results for the Danish participants in the EU-wide stress test 2021

Published 30-07-2021

Danske Bank, Nykredit, Jyske Bank, and Sydbank have participated in the EU-wide stress test 2021. This is a very severe stress test, which leads to significant decreases in the capital ratios of the institutions. For Danske Bank the decrease is of a magnitude that the institution has to make use of the capital conservation buffer over the three-year projection. Jyske Bank fulfils its capital requirements, but with modest excess capital. All institutions fulfil their solvency need with a comfortable margin.

The new results show that the capitalisation of some of the largest Danish institutions come under pressure in the EU-wide stress test. However, all Danish institutions retain capital that is comfortably above their solvency need. The results reflect a very severe adverse scenario, which is assumed to build on an already stressed macroeconomic starting point as a result of the COVID-19 crisis. Although this is a very severe stress test, the results underline the need for institutions to maintain a robust capitalization going forward", says Director General Jesper Berg.

The results of the EU-wide stress test will be included in the Danish Financial Supervisory Authority's (DFSA) considerations regarding the setting of a so-called ”Pillar II Guidance” (P2G) for the participating Danish institutions. The Pillar II Guidance can be interpreted as a prudential add-on to the solvency need.

The DFSA's ongoing dialogue with the institutions on capital targets and distribution policy will continue to be based on stress tests based on scenarios and assumptions laid down by the DFSA.

Read the full press release here.

See all the Danish results here.

Last updated 30-07-2021


Kristian Vie Madsen
Deputy Director General