Advertisement

The Conversion of Bank Deferred Tax Assets in 2016 to Bank Shares in 2017

  • Panagiotis PapadeasEmail author
Conference paper
Part of the Springer Proceedings in Business and Economics book series (SPBE)

Abstract

This study correlates the provisions of CRD IV with the application of IFRS in banks operating in Greece. The accounting losses allow the creation of additional DTA which are transferred in claims against the state (tax credit). Thus, in 2017 conversion rights (warrants) may be issued which represent common shares of total market value equal to 100% of these tax credits. Then, equivalent special reserve is formed, and the equity capital of banks is increased, since the DTA are not deducted from the common equity tier 1 (CET 1) ratio.

Keywords

Capital adequacy Deferred tax Loss provisions Banks in Greece 

References

  1. Acharya, V., Mehran, H., Schuermann, T., & Thakor, A. (2011). Robust capital regulation. Federal Reserve Bank of New York, Staff Report Νo. 490.Google Scholar
  2. Alpha Bank. (2017). Financial information, Athens.Google Scholar
  3. Bank of Greece. (2011–2017). The Governor’s annual report, Athens.Google Scholar
  4. BCBS. (1998). International convergence of capital measurement and capital standards. Basel: Bank for International Settlements.Google Scholar
  5. Blundell-Wignall, A., & Atkinson, P. (2010). Thinking beyond Basel III: Necessary solutions for capital and liquidity. OECD Journal: Financial Market Trends, 2010(1), 9–33.Google Scholar
  6. Eurobank (2017). Annual reports. Athens.Google Scholar
  7. Gregoriou, G. (2009). Operational risk toward Basel III: Best practices and issues in modeling, management, and regulation. Hardcover: Wiley.CrossRefGoogle Scholar
  8. Hytis, E. (2015). Why does the increase in taxation rates benefit the banks with losses? EURO2day. Athens (in Greek).Google Scholar
  9. International Accounting Standards Board. (2012). IAS 12 income taxes. London.Google Scholar
  10. Kalfaoglou, F. (2012, April). The framework of the banks’ capital adequacy. Economic Bulletin of Bank of Greece, 36 (in Greek).Google Scholar
  11. Merler, S. (2015). Deferred tax credits may soon become deferred troubles for some European banks. Retrieved from http://bruegel.org
  12. National Bank of Greece. (2017). Financial Report. Athens.Google Scholar
  13. Papadeas, P., Hyz, A., & Kossieri, E. (2016). IASBasel: The contribution of losses to the banks’ capital adequacy. International Conference on Business and Economic, ICBU HOU, Athens. Google Scholar
  14. Piraeus Bank. (2017). Financial results. Athens.Google Scholar

Copyright information

© Springer Nature Switzerland AG 2019

Authors and Affiliations

  1. 1.Department of Accounting and FinanceUniversity of West AtticaAthensGreece

Personalised recommendations