Pages

Standards and transition period determined

- Regulatory minimums — "The minimum capital standards announced by the BCBS on September 12 were 4.5% for Core Tier I capital, 6% for Tier I capital, and 8% for overall capital adequacy."
- Capital buffers — "Banks will be required to secure a 2.5% capital preservation buffer (via common stock) by 2019. In addition, they will be required to amass a buffer of up to 2.5% during periods when the economy is overheating (lossabsorbing capital is acceptable)."
- Transition period — "The new capital adequacy regulations will be introduced in stages. In stage one, minimum capital adequacy ratios will be phased in (the Core Tier I ratio will be 3.5% in 2013 and 4.5% in 2015). The capital preservation buffer will be introduced in the second stage (0.625% in 2016,
2.5% in 2019)."
- Existing preferred securities — "Banks will lose the right to count capital that does not meet new stricter standards as Tier I capital in 10ppt increments from 2013 (with the full amount removed from Tier Ih capital by 2023)."
- Leverage ratio — "A monitoring period will run from 2011 to 2013, followed by a trial period until 2017. Full-scale introduction will come in 2018. The minimum leverage ratio (Tier I capital in the numerator) will be 3%."
- Liquidity coverage ratio — "The Liquidity Coverage Ratio (LCR) will be introduced in 2015 and the Net Stable Funding Ratio (NSFR) will be introduced in 2018. The minimum for both will be 100%."




Citigroup_Basel_Primer_20100915

No comments:

Post a Comment