December 2, 2019 / 5:17 PM / 2 months ago

UniCredit says new MREL requirement set at 10.7% of TLOF

MILAN, Dec 2 (Reuters) - UniCredit said on Monday it had received the new minimum requirement for loss-absorbing liabilities Italy’s biggest bank will have to hold starting from June 30, 2022.

UniCredit said the so-called MREL requirement had been set at 10.67% of total liabilities and own funds (TLOF) - equivalent to 25.2% of risk-weighted assets (RWAs) as of Dec. 31, 2017.

The MREL requirement must be met for 8.29% with subordinated instruments taking into account an allowance equivalent to 2.5% of RWAs, UniCredit said.

Following the global financial crisis which resulted in costly bank bailouts, lenders are being required to hold on their balance sheets a large amount of liabilities that can be wiped out to offset potential losses.

Reporting by Valentina Za

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