Basel Committee publishes more details on global systemically important banks

06 December 2018

The Basel Committee on Banking Supervision published further information related to its 2018 assessment of global systemically important banks (G-SIBs), including additional details to help understand the scoring methodology.

The publication accompanies the Financial Stability Board’s release of the updated list of G-SIBs and includes:

  • a list of all the banks in the assessment sample;
  • the denominators of each of the 12 high-level indicators used to calculate the banks’ scores;
  • for the first time, the 12 high-level indicators for each bank in the sample used to calculate these denominators;
  • the cutoff score used to identify the G-SIBs in the updated list and the thresholds used to allocate G-SIBs to buckets for the purpose of calculating the specific higher loss absorbency requirements; and
  • links to disclosures of all banks in the assessment sample.

Methodology

The Committee’s methodology assesses the systemic importance of global banks using indicators, which are calculated based on data for the previous fiscal year-end supplied by banks and validated by national authorities. The final scores are mapped to corresponding buckets, which determine the higher loss absorbency requirement for each G-SIB.

First review

In July, the Committee concluded its first review of the G-SIB framework and published a revised assessment methodology, which is expected to be implemented in member jurisdictions by 2021.

The Committee will complete the next review of the G-SIB framework by 2021. The full amount of the higher loss absorbency requirement will come into effect from 1 January 2019, in line with the implementation schedule for the Basel III capital conservation buffer.

Source: https://www.bis.org

Leave a Reply

Your email address will not be published. Required fields are marked *