General Information & Client Service
  • Americas: +1.212.553.1653
  • Asia: +852.3551.3077
  • China: +86.10.6319.6580
  • EMEA: +44.20.7772.5454
  • Japan: +81.3.5408.4100
Media Relations
  • New York: +1.212.553.0376
  • London: +44.20.7772.5456
  • Hong Kong: +852.3758.1350
  • Tokyo: +813.5408.4110
  • Sydney: +61.2.9270.8141
  • Mexico City: +001.888.779.5833
  • Buenos Aires: +0800.666.3506
  • São Paulo: +0800.891.2518
December 20, 2017

EBA published an assessment report that quantifies the impact of the recently agreed reform package by BCBS on the European banking system; this follows up on the cumulative assessment published on December 07, 2017. The report presents aggregate data on EU banks and assumes full implementation of the final Basel III framework, as endorsed by the Group of Central Bank Governors and Heads of Supervision (GHoS).

The report reflects all the revisions to the credit and operational risk approaches as well as revisions to the process for the estimation of leverage ratio. However, it does not include changes resulting from the revised securitization framework and the revised credit valuation adjustment (CVA) risk framework. Overall, the results, based on data as of December 31, 2015, show that European banks' minimum tier 1 capital requirement would increase by 12.9% at the full implementation date. To comply with the new framework, EU banks would need EUR 17.5 billion of additional CET1 capital, with the total capital shortfall being EUR 39.7  billion. Additionally, 20.5% of the EU banks in the sample would be constrained by the output floor, which has been set by the GHoS at 72.5% of the standardized approach requirements. 

This exercise monitors the impact of fully implementing the Basel reform package on banks' minimum required capital, capital ratios (risk-based and non-risk-based), and capital shortfalls. The results of the report are presented separately for Group 1 and Group 2 banks. Group 1 banks include internationally active banks with tier 1 capital in excess of EUR 3 billion while all other banks are categorized as Group 2 banks. The analysis provides separate figures for the sample of global systemically important institutions. Where applicable, the analysis takes account of capital buffer of the global systemically important institutions, for the risk-based capital requirements and the leverage ratio requirements.

 

Related Link: Press Release

Keywords: Europe, EU, Banking, Basel III, Impact Assessment, Regulatory Reforms, EBA

Related Insights
News

US Agencies Extend Consultation Period for the Proposed SA-CCR

US Agencies (FDIC, FED, and OCC) extended the comment period for a proposed rule to update their standards for how firms measure counterparty credit risk posed by derivative contracts.

February 18, 2019 WebPage Regulatory News
News

FED Extends Consultation Period for Stress Testing Rule

FED has published in the Federal Register a notice proposing amendments to the company run and supervisory stress test rules.

February 15, 2019 WebPage Regulatory News
News

EBA Single Rulebook Q&A: Third Update for February 2019

EBA published answers to two questions under the Single Rulebook question and answer (Q&A) updates for this week.

February 15, 2019 WebPage Regulatory News
News

FSB Report Examines Financial Stability Implications of Fintech

FSB published a report that assesses fintech-related market developments and their potential implications for financial stability.

February 14, 2019 WebPage Regulatory News
News

US Agencies Amend Regulatory Capital Rule to Allow Phase-In for CECL

US Agencies (FDIC, FED, and OCC) adopted the final rule to address changes to credit loss accounting under the U.S. generally accepted accounting principles; this includes banking organizations’ implementation of the current expected credit losses (CECL) methodology.

February 14, 2019 WebPage Regulatory News
News

FASB Proposes Taxonomy Improvements for the Credit Losses Standard

FASB proposed the taxonomy improvements for the proposed Accounting Standards Updates on Targeted Transition Relief for Topic 326 (Financial Instruments—Credit Losses) and Topic 805 (on Business Combinations—Revenue from Contracts with Customers).

February 14, 2019 WebPage Regulatory News
News

SRB Publishes Framework for Performing Valuations in Resolution

SRB published its framework for performing valuations in resolution. The framework provides independent valuers and the general public with an indication of the expectations of SRB on the principles and methodologies for valuation reports, as set out in the legal framework.

February 14, 2019 WebPage Regulatory News
News

FED Issues Correction in Historical Dataset in its 2019 Stress Tests

FED identified an error in the historical dataset used in its 2019 stress tests and issued a correction.

February 13, 2019 WebPage Regulatory News
News

OCC Consults on Company-Run Stress Test Requirements for Banks

OCC proposed amendments to its company-run stress testing requirements for national banks and Federal savings associations, consistent with section 401 of the Economic Growth, Regulatory Relief, and Consumer Protection (EGRRCP) Act.

February 12, 2019 WebPage Regulatory News
News

CFTC Extends Comment Periods for Trade Execution Requirement Proposals

CFTC announced that it is extending comment period for the proposed amendments related to the regulations on swap execution facilities (SEF) and trade execution requirement.

February 12, 2019 WebPage Regulatory News
RESULTS 1 - 10 OF 2610