Banco de Occidente, a subsidiary of Grupo Aval, was classified as a systemic bank in November 2024. This regulatory designation mandates a 100 basis points increase in its core equity Tier 1 capital requirements.
The increased capital requirements will be implemented over a two-year transition period. This change necessitates a strategic approach to capital management for the bank and its parent company.
Management has expressed confidence in meeting these new capital requirements through internal capital generation and optimized use of Basel III options, without the need for additional external capital raises.
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