OP Cooperative
OP Corporate Bank plc
OP Mortgage Bank
Stock Exchange Release, 26 April 2019 at 5.55 pm EEST
Inside information

ECB's decision increases the risk weights of OP Financial Group's home loans - no impact on OP Financial Group's capital adequacy

On 25 April 2019, the ECB issued OP Financial Group with a decision on retail exposures as part of the TRIM project (Targeted Review of Internal Models). The decision, which will take effect immediately, increases the risk weights of home loans applied in OP Financial Group's capital adequacy measurement from their current level of 6% to approximately 12%. These risk weight increases will be valid until further notice, until the qualitative requirements set out in the decision have been met.

The decision has no effect on OP Financial Group's capital adequacy in the current situation where both the IRBA risk weight floor set previously by the ECB and the 15% risk weight floor on home mortgages set by the Finnish Financial Supervisory Authority are in force.

As a result of the increase in risk weights on home loans, the CET1 ratio of OP Mortgage Bank will decrease to approximately 60% (31 Dec. 2018: 136.4%). Even after the ECB decision, OP Mortgage Bank's capital adequacy remains very strong.

The euro area-wide TRIM project examines internal models that part of the banks use for calculating how much capital they need in order to meet their statutory capital requirements.

OP Corporate Bank plc
OP Cooperative
Tuuli Kousa
Chief Communications Officer

For additional information, please contact:
OP Communications, tel. +358 50 523 9904, viestinta@op.fi

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OP Financial Group is Finland's largest financial services group whose mission is to create sustainable prosperity, security and wellbeing for its owner-customers and in its operating region by means of its strong capital base and efficiency. OP Financial Group consists of 155 OP cooperative banks, its central cooperative OP Cooperative, and the latter's subsidiaries and affiliates. The Group has a staff of 12,000 and 1.9 million owner-customers.
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OP Corporate Bank and OP Mortgage Bank are responsible for OP's funding in money and capital markets. As laid down in the applicable law, OP Corporate Bank, OP Mortgage Bank and their parent company OP Cooperative and other OP Financial Group member credit institutions are ultimately jointly and severally liable for each other's debts and commitments. OP Corporate Bank acts as OP's central bank.