The European Central Bank (ECB) will survey banks next year about geopolitical events that could affect their capital by at least 300 basis points.
The results of this survey, which will be based on an inverted stress test – in which there is a predetermined result and each bank defines the scenarios in which each of these results would materialize – and will serve to verify how geopolitical risks could affect solvency.
In a statement on its portal, the regulator states that the test will complement the stress test carried out by the European Banking Authority (EBA) and will be carried out with 110 banks in the euro zone, with the conclusions expected to be published in the summer of 2026.
Banks will therefore consider that geopolitical situations could reduce their Common Equity Tier 1 (CET1) ratio by at least 300 basis points.
This ratio is the main solidity indicator for the ECB.
In addition to identifying these risks, banks will have to record how geopolitical risks may affect their liquidity and financing conditions.
The aggregate CET1 of banks in the euro zone stood at 16.05% at the end of the first quarter, against 15.95% in the previous quarter and 15.74% in the same quarter of 2024.
In Portugal, according to data from the Bank of Portugal (BdP), in the first quarter this ratio was 17.89%, compared to 18.00% in the fourth quarter of 2024 and 17.13% a year earlier.