EBA Publishes an Updated Quantitative Analysis on MREL
EBA published an updated quantitative analysis on the minimum requirement for own funds and eligible liabilities (MREL). This update covers the analysis of MREL ratios, MREL capacity, MREL quality, and estimated MREL funding needs of the full sample of 112 EU banks, as of the end of December 2016. Additionally, a consistent sample of 100 banks has been used to compare the evolution of MREL during 2016.
Based on the methodology and assumptions developed in the context of the MREL report published in December 2016, EBA updated its estimates of capacity and funding needs of a representative sample of European banks to meet MREL under alternative scenarios. In this exercise, EBA highlighted a modest improvement in the stack of MREL-eligible instruments in 2016. MREL is a requirement for a bank to hold a sufficient amount of own funds and debt instruments of a certain quality to absorb losses and recapitalize its critical functions in case of failure. The two scenarios considered in the report for the calibration of MREL are the loss-absorbing buffer (LA buffer) and the Buffer/8% scenarios. LA buffer scenario amounts to twice the capital requirements where combined buffer requirements are only included once for loss absorption purposes, while the Buffer/8% scenario is a more stringent calibration where banks must meet the higher of twice capital requirements and buffers, or 8% of total liabilities and own funds.
Related Link: Press Release
Keywords: Europe, EU, Banking, MREL, Quantitative Analysis, EBA
Previous Article
EBA Publishes Final Report on Recommendations on Cloud OutsourcingNext Article
DNB Issues Banking Newsletter for December 2017Related Insights
|
News
EBA Finalizes Guidelines on the STS Criteria in SecuritizationEBA published the final guidelines that provide a harmonized interpretation of the criteria for a securitization to be eligible as simple, transparent, and standardized (STS) on a cross-sectoral basis throughout EU.
December 12, 2018
WebPage
Regulatory News
|
|
News
OSFI Sets Domestic Stability Buffer for D-SIBs at 1.75%OSFI set the level for the Domestic Stability Buffer at 1.75% of total risk-weighted assets, as calculated under the Capital Adequacy Requirements (CAR) Guideline.
December 12, 2018
WebPage
Regulatory News
|
|
News
FSI Publishes Paper on Proportionality in Insurance Solvency RulesFSI published a paper on proportionality in the application of insurance solvency requirements.
December 11, 2018
WebPage
Regulatory News
|
|
News
BCBS Updates Framework for Pillar 3 Disclosure RequirementsBCBS published the updated framework for Pillar 3 disclosure requirements.
December 11, 2018
WebPage
Regulatory News
|
|
News
EBA Issues Revised List of Validation Rules for ReportingEBA revised the list of validation rules in its implementing technical standards on supervisory reporting.
December 11, 2018
WebPage
Regulatory News
|
|
News
IMF Reports Assess the Stability of Financial System in BrazilIMF published a report on the results of the Financial System Stability Assessment (FSSA) on Brazil.
December 11, 2018
WebPage
Regulatory News
|
|
News
FED Governor Examines Pros of Imposing Capital Buffers on Large BanksAt the Peterson Institute for International Economics in Washington D.C., the FED Governor Lael Brainard summarized the financial stability outlook, highlighted areas where financial imbalances seem to be building, and touched on the related policy implications.
December 07, 2018
WebPage
Regulatory News
|
|
News
US Agencies Propose Rule on Appraisals for Real Estate TransactionsUS Agencies (FDIC, FED, and OCC) proposed a rule to increase the threshold level at or below which appraisals would not be required for the residential real estate transactions from USD 250,000 to USD 400,000. Comments will be accepted for 60 days from publication in the Federal Register.
December 07, 2018
WebPage
Regulatory News
|
|
News
EBA Single Rulebook Q&A: First Update for December 2018This week one answer was published as part of the Single Rulebook Questions and Answers (Q&A).
December 07, 2018
WebPage
Regulatory News
|
|
News
FED Updates Reporting Form and Instructions for FR Y-14QFED published the updated reporting form FR Y-14Q for Capital Assessment and Stress Testing, along with the associated instructions.
December 06, 2018
WebPage
Regulatory News
|
