EBA updated the 2018 list of other systemically important institutions (O-SIIs) in EU. The list also reflects the additional capital buffers that the relevant authorities have set for the identified O-SIIs. The list of O-SIIs is disclosed annually, along with any common equity tier 1 (CET1) capital buffer requirements, which may need to be set or reset. Higher capital requirements will become applicable once relevant authorities decide to set institution-specific buffer requirements as a consequence of this O-SII identification.
O-SIIs are deemed systemically important and have been identified by the relevant authorities across EU based on the harmonized criteria in the EBA guidelines on criteria to assess O-SIIs. The guidelines define size, importance, complexity, and interconnectedness as the criteria to identify O-SIIs. They provide flexibility for the relevant authorities to apply their supervisory judgment when deciding whether to include other institutions that might have not been automatically identified as O-SIIs. This approach allows for the assessment of all financial institutions across EU in a comparable way, while still not excluding those firms that may be deemed systemically important for one jurisdiction on the basis of certain specifications. EBA acts as the single point of disclosure for the list of O-SIIs across EU, while each relevant authority discloses information for its respective jurisdiction, along with further details on the underlying rationale and identification process.
Keywords: Europe, EU, Banking, O-SII, Capital Buffers, CET 1, Systemic Risk, EBA
Across 35 years in banking, Blake has gained deep insights into the inner working of this sector. Over the last two decades, Blake has been an Operating Committee member, leading teams and executing strategies in Credit and Enterprise Risk as well as Line of Business. His focus over this time has been primarily Commercial/Corporate with particular emphasis on CRE. Blake has spent most of his career with large and mid-size banks. Blake joined Moody’s Analytics in 2021 after leading the transformation of the credit approval and reporting process at a $25 billion bank.
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