Bank of Lithuania

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Central credit unions and central credit union groups

  • Own funds requirements:
    • Common Equity Tier 1 capital ratio of 4.5 per cent
    • Tier 1 capital ratio of 6 per cent
    • total capital ratio of 8 per cent
  • Additional capital buffer requirements:
    • capital conservation buffer of 2.5 per cent
    • institution’s special countercyclical capital buffer requirement. The supervisory authorities of Member States may, at their own discretion, set the amount of a specific countercyclical capital buffer for a particular institution or a group of institutions, thereby mitigating the risk of unsustainable growth and securing the banking sector and the economy against a credit boom. Detailed information on the countercyclical buffer rate in Lithuania can be found in the table "Decisions for setting the countercyclical capital buffer rate"
    • other systemically important institutions buffer requirement
  • Liquidity – the value of the liquidity coverage ratio (LCR) must not be below 100 per cent
  • Large exposure requirement – the amount of loans to a single borrower, taking into account the impact of credit risk mitigation measures, must not exceed 25 per cent of an institution's eligible capital. When the client is an institution (bank or investment company) or when a group of connected clients includes one or several institutions, the ratio must not exceed 25 per cent of the institution's eligible capital, or EUR 150 million, whichever the higher.

The Bank of Lithuania may set other ratios without contradiction to the recommendations of the Basel Committee on Banking Supervision and European Union directives.


Credit unions

  • Capital adequacy – the ratio of a credit union’s adjusted capital to the total sum of its capital requirement for covering credit, market, settlement, counterparty credit and operational risks:
    • for credit unions – not below 10.5 per cent
    • for credit unions seeking restructuring – not below 14.5 per cent
  • Liquidity – the ratio of a credit union’s liquid assets to its net liquidity outflow (not below 100 per cent)
  • Maximum open position in foreign currency – the ratio of the overall open position to a credit union’s adjusted capital (must not exceed 25 per cent), and the ratio of the open position in a single currency to a credit union’s adjusted capital (must not exceed 15 per cent of the credit union’s adjusted capital)
  • Maximum exposure to a single borrower – the amount of loans to a single borrower must not exceed 25 per cent of a credit union’s adjusted capital.

Credit unions established until 1 January 2018 (subject to a transitional period)

  • Capital adequacy ratio:
    • credit unions that are members of central credit unions:
      • from 1 January 2018 – not below 5.25 per cent
      • from 1 January 2019 – not below 5.78 per cent
      • from 1 January 2020 – not below 6.30 per cent
      • from 1 January 2021 – not below 6.83 per cent
      • from 1 January 2022 – not below 7.35 per cent
      • from 1 January 2023 – not below 7.88 per cent
      • from 1 January 2024 – not below 8.40 per cent
      • from 1 January 2025 – not below 8.93 per cent
      • from 1 January 2026 – not below 9.45 per cent
      • from 1 January 2027 – not below 9.98 per cent
      • from 1 January 2028 – not below 10.5 per cent
    • credit unions to be restructured:
      • from 1 January 2018 – not below 7.30 per cent
      • from 1 January 2019 – not below 8.70 per cent
      • from 1 January 2020 – not below 10.20 per cent
      • from 1 January 2021 – not below 11.60 per cent
      • from 1 January 2022 – not below 13.10 per cent
  • Maximum exposure to a single borrower – until 31 December 2027, the amount of loans to a single borrower granted by credit unions (i) that are members of central credit unions and (ii) whose capital adequacy ratio is below 10.5 per cent must not exceed the smaller of the two following values: 25 per cent of the credit union’s adjusted capital, or EUR 150,000.

The Bank of Lithuania has the right to establish individual ratios for each credit union.

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Last update: 06-06-2019