Courtesy of PKO BP

Poland's largest bank by assets, PKO Bank Polski, successfully passed a stress test, meaning the Committee of European Banking Supervisors (CEBS) - which administered the health check - has found that its capital ratios are sufficient to enable it to weather a "double-dip" recession. PKO BP was the only Polish bank to have undergone the examination.

The bank's solvency ratio will not fall below 15 percent, even if the European economy slumps back into a recession, the results show. The bank’s Tier 1 ratio - the toughest measure of capital – was 13.3 percent. The CEBS had set the threshold for passing at six percent.

“Though this exercise was purely theoretical, we are very satisfied by the bank’s great result, whose ratio significantly exceeded required levels,” PKO BP CEO Zbigniew Jagiełło said. “On that basis one can clearly say the bank is in good financial condition and indicates considerable capital strength as well as resistance to the influence of a potentially worse [economic] situation,” he said.

In the event of a "double-dip," however, seven European banks could face problems with keeping their capital ratios at safe levels. Five Spanish banks, a German bank and a Greek one all failed the tests, which revealed they could be short of the required solvency ratio by a total of some €3.5 billion. However, overall the stress test results were better than expected.

The examination was conducted on 91 institutions from 20 EU countries.

Poland AM