BaFin and the Deutsche Bundesbank presented the results of the LSI stress test 2026 on 24 September 2026, and the sentence with the longest reach sits in the last paragraph of the press release. Going forward, a less significant institution (LSI) receives Pillar 2 guidance (P2G, in German the Eigenmittelempfehlung) only if its capital ratios…
The ESPREP-STT reporting template that Luxembourg banks filed for years now sits in the CSSF archive. Circular CSSF 08/338, the instrument behind it, and the ESPREP-STT workbook itself have both been archived since 6 August 2025, and the CSSF catalogue records the circular as repealed. What that return measured, the interest rate risk in the…
On 20 February 2026 the Basel Committee on Banking Supervision published Working Paper No 47, a 35-page literature review titled “Literature review on non-maturity deposit stability: established factors and recent developments”. Non-maturity deposit stability is the question of how reliably sight deposits, current accounts and savings balances stay put when a bank comes under stress,…
Between mid-2022 and late 2023, the ECB raised its deposit facility rate from -0.50% to 4.00%, a shift of 450 basis points in under 18 months. For Luxembourg banks that had built fixed-rate asset portfolios during the low-rate era, financed by short-term or variable-rate liabilities, the economic value of equity (EVE) moved sharply. Institutions that…