(Adds detail from regulatory statement, background on ECB asset
FRANKFURT, March 6 German lender IKB
said it had asked the bank regulator to allow it to count some
assets and its interim group profit toward a calculation of its
equity position, as it prepares itself for a review of its
assets by the European Central Bank.
The accounting move would enable the Duesseldorf-based
lender to free up equity, a spokesman for the company said on
IKB said it had asked the regulatory authority to recognise
the addition of group profits and a "fund for general banking
risk" in its calculation of common equity tier 1 capital in the
third quarter of the financial year ending December 31, 2013.
If the regulator allows this, IKB would be able to report it
had a common equity tier 1 capital ratio of 9.1 percent on
December 31, 2013.
Banks being tested by the European Central Bank need to meet
a minimum Core Tier 1 equity capital requirement of 8 percent of
risk-weighted assets by the end of 2013, something IKB described
as "surprisingly harsh ... that left banks little time to
IKB is the smallest German bank deemed important enough to
be supervised from November by the ECB rather than the national
regulator. IKB said last year it could meet the ECB's demands,
but it would not be easy.
IKB was known before the financial crisis mainly as a lender
to mid-sized German companies. It required several bailouts from
development bank KfW and the German state after its off-balance
sheet investment vehicles ran into funding problems in 2007.
Separately, IKB further said its consolidated net income for
the first nine months ending December 31, 2013 was 39 million
euros ($53.98 million).
($1 = 0.7225 euros)
(Reporting by Edward Taylor, editing by William Hardy)