Raiffeisen Upper Austria boosts capital ratio

VIENNA, April 16 Wed Apr 16, 2014 4:00am EDT

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VIENNA, April 16 (Reuters) - Raiffeisen Landesbank Oberoesterreich AG'S (RLB OOe) group core capital ratio under Basel II standards rose by a full percentage point to 9.8 percent of risk-weighted assets in 2013, the bank said on Wednesday.

The Raiffeisen bank for the province of Upper Austria is one of six Austrian lenders due to come under direct supervision by the European Central Bank in November.

It said the group's capital ratio would improve under Basel III rules and IFRS accounting but it did not give more detailed figures along with its annual results.

RLB OOe is the third-largest shareholder of Raiffeisen Zentralbank, the unlisted parent of Raiffeisen Bank International.

The group consists of Raiffeisenlandesbank Oberoesterreich AG, Privat Bank AG, bankdirekt.at AG and 95 Upper Austrian Raiffeisen banks.

The group's total assets fell 6 percent last year to 37.4 billion euros ($51.7 billion) as it scaled back risk.

Group operating profit under IFRS accounting rose 2.8 percent to 422.6 million euros, while risk provisioning more than halved to 145.9 million.

The bank was in the news this month when Chief Executive Heinrich Schaller threatened to move its headquarters across the border to Germany in a growing row with the government over a bank levy which lenders say is too onerous.

RLB OOe said on Wednesday up to 25 outside auditors and two experts from the Austrian central bank would comb through nearly 54 percent of its loan book by the end of July under the ECB-led health check of big euro zone banks' balance sheets.

This asset quality review would cost around 4.5 million euros and an accompanying stress test another 1 million excluding the costs of getting its data into the required form. It called such high costs unjustified and questioned whether the checks would make the banking system any safer.

($1 = 0.7234 Euros) (Reporting by Michael Shields; Editing by Mark Potter)

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