Basel
21 November 2016
Reporter: Drew Nicol

FSB updates G-SIB list


The Financial Stability Board (FSB) has revised its ranking list of globally systemically important banks (G-SIB) using year-end 2015 data.

The number and names of banks identified as G-SIBs remained the same (30 banks), but several banks were reclassified.

Four banks moved up a place. Citigroup rose to fourth, Bank of America moved up to third, and Industrial and Commercial Bank of China and Wells Fargo took second place.

Meanwhile, three banks moved down a step. HSBC went from fourth to third, Barclays dropped to second, and Morgan Stanley moved down to first.

G-SIBs have been allocated to buckets corresponding to the higher capital buffers that they would be required to hold by national authorities since an update to Basel III’s framework in November 2012.

The lowest level-one G-SIBS are required to hold an additional 1 percent of capital on their books, with each level adding a further 0.5 percent up to the highest level (five), which requires 3.5 percent extra capital.

The most recent assignment will determine the additional buffer requirements that will apply from 1 January 2018.

G-SIBs will also be required to meet the total loss-absorbing capacity standard from the start of 2018.

The changes, which come in consultation with the Basel Committee on Banking Supervision and national authorities, reflect the improvement of data quality and changes in underlying activity.

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