DBRS Morningstar: Large Dutch Banks Well Prepared for Additional Capital Requirements
The Dutch Central Bank (DNB) has recently announced its intention to implement increased risk weighting on mortgages from the autumn of 2020 for an initial period of two years to strengthen Dutch banks’ ability to absorb the impact of a potential negative adjustment in house prices. DBRS Morningstar views this as manageable for the large Dutch banks.Key highlights from DBRS’ commentary discussing additional capital requirements in the Netherlands:
• The Dutch Central Bank (DNB) announced its intention to implement increased risk weighting on mortgages from autumn 2020 for an initial period of two years.
• In DBRS Morningstar’s view, large Dutch banks benefit from robust capital cushions at end-June 2019 and strong profitability levels.
• DBRS Morningstar anticipates that internal capital generation will remain good, supporting the banks’ ability to absorb the changes.
“While the large Dutch banks are displaying solid capital and profitability levels, they have also been actively anticipating the implementation of Basel IV taking mitigating measures. As a result, the partial front loading of higher risk-weighted assets for mortgages is manageable.†said Vitaline Yeterian from DBRS’ EU Financial Institutions team.
This commentary “Large Dutch Banks Well Prepared for Additional Capital Requirements†is available at
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