The Italian bank UniCredit announced today that it obtained authorization from the European Central Bank to apply the methodology known as the 'Danish Compromise' in calculating the group's consolidated capital ratios. This authorization will allow that, starting from the reporting relative to the third quarter of 2026, stakes in insurance companies will be treated through risk weighting, instead of being deducted from regulatory capital.
The decision should reinforce UniCredit's highest quality capital ratio by approximately 52 basis points, based on the position recorded at the end of the second quarter of this year. The group indicated that this methodology will allow it to strengthen its capital position and reinforce its disciplined capital allocation capacity.
The approval complies with UniCredit's commitment to obtain authorization for the application of the methodology by the end of September. The 'Danish Compromise' is a prudential rule that, under certain conditions, allows banking groups with stakes in insurance companies to treat these stakes through a risk weighting, instead of proceeding with their direct deduction from regulatory own funds.
