DGAP-News

Aareal Bank AG: ECB reviews confirm Aareal Bank's capital and financial strength (news with additional features)

DGAP-News: Aareal Bank AG / Key word(s): Miscellaneous/Miscellaneous
Aareal Bank AG: ECB reviews confirm Aareal Bank's capital and
financial strength (news with additional features)

26.10.2014 / 12:33

---------------------------------------------------------------------

ECB reviews confirm Aareal Bank's capital and financial strength

- Aareal Bank passes European Central Bank's Comprehensive Assessment
with good results

- Asset Quality Review leads to only marginal adjustments

- Capital ratios clearly exceed ECB's requirements in all stress test
scenarios

- CEO Dr Wolf Schumacher: "Test results provide clear evidence of the
viability of Aareal Bank's business model"

Wiesbaden, 26 October 2014 - Aareal Bank achieved consistently convincing
results during the Comprehensive Assessment carried out by the European
Central Bank (ECB) - both in terms of the Asset Quality Review (AQR)
conducted by the ECB, which included a review of the valuation and
classification of the Bank's lending exposures, as well as in relation to
the subsequent stress test coordinated by the European Banking Authority
(EBA), which analysed the impact of changes in the macroeconomic
environment on the banks' capital ratios in all scenarios. Due to the good
results achieved in both tests of the Comprehensive Assessment, the ECB has
not imposed any measures upon Aareal Bank.

Today, the ECB published Aareal Bank's detailed results as part of the
overall disclosure of data for all 130 European banks under review, based
on data as at the reporting date of 31 December 2013. According to these
results, Aareal Bank performed well in the AQR. Regulators only made
marginal adjustments to the exposures under review, which mainly concerned
mark-to-model haircuts - thus affirming Aareal Bank's risk assessments.
Moreover, no exposure was re-classified from 'performing' to
'non-performing': Aareal Bank's classifications were thus confirmed.
Overall, the AQR only resulted in a minor adjustment to the Bank's Common
Equity Tier 1 (CET1) ratio by 10 basis points, from 16.39 to 16.29 per
cent.

During the course of the stress test, Aareal Bank's capital ratios in the
so-called baseline scenario (which reflects expected macroeconomic
developments until 2016) remained virtually unchanged from their current
levels. The adverse scenario implied a marked deterioration of the
macroeconomic environment. These stress test assumptions led to a decline
of the imputed CET1 ratio (according to the conditions of the stress test)
by about 28 per cent to approximately 11.8 per cent at the end of the test
horizon (31 December 2016). This is still more than double the applicable