Article ID: 4b031b196c6659e8b1a4f1e69ca9883da8bb63201097d4b1919b45d84152548f
Source ID: regulatory:risk.net
Published At: -
Extraction Method: trafilatura
URL: https://www.risk.net/topics/capital-requirements
Body Text
Capital requirements EU’s plan to get competitive faces big legislative hurdles Large and controversial legislative package may be too amorphous to deliver results quickly European banks rebuild AT1 capital stock Additional Tier 1 capital up 26% since end of 2023 Banks urge Singapore to relax exposure limit on crypto assets Lower capital for tokenisation and stablecoins welcomed, but cap will curb bank involvement for now BoE’s crisis lending plan hits buffers Scepticism greets regulator’s proposal to increase releasable leverage capital buffers BoE leverage overhaul could free up $9bn for UK banks NatWest and Lloyds stand to benefit the most, while HSBC and StanChart face modest increases BoE’s leverage ratio rejig to hit HSBC and StanChart Proposed changes aim to rebalance scales in favour of domestic lending Small UK lenders set to escape leverage ratio ratchet BoE’s planned economic indexation of tougher prudential thresholds could ease capital planning Risk density and capital requirements inversely related – FSI Report says jurisdictions could be choosing between higher capital requirements or model restrictions US Basel III will provide reprieve for clearing, but no release Worst excesses of original endgame proposal avoided, but increased capacity still seen as unlikely US banks cluster at stronger DFAST capital lows Weakest projected capital ratio rises 390bp since 2018 Floored: Basel III rethink upsets IRB dominance Introduction of output floor means internal ratings’ popularity takes a hit, but isn’t quite out for the count UK undercuts EU on stablecoin capital requirements FCA relaxation from 2% to 1% could spark “race to the bottom” on capital Banks welcome UK IMA eligibility test delay, but some want more Risk Live: PRA extends monitoring for ‘Spearman’ test, while US regulators drop correlation metric DFAST 2026: SCB freeze denies 16 banks capital relief Lower DFAST depletion would have cut buffers for many, but First Citizens avoids higher SCB Basel’s CVA upgrade: persuasive in the US, less so in Europe Ban on credit risk models could encourage US banks to adopt more sophisticated CVA method Six banks fall short of full DFAST buffers DB USA and HSBC North America post largest all-in CET1 shortfalls, while new entrant First Citizens also misses US regulators cut FRTB’s IMA capital hit by 59%, Isda finds Trade body pushes for further changes to cross-product netting, default risk charge US FRTB glitch could spit out negative capital charges Effort to recognise risk diversification between IMA and standardised approach went too far Don’t mind the gap risk: regulatory treatment of credit repacks Gap risk in repackaging is not a credit valuation adjustment for Basel III capital purposes, argues senior quant Andrey Chirikhin Double, but no trouble? CVA capital hit may lack clout Industry opinion mixed around Basel III endgame derivatives charge Erba myth: will US banks choose new capital measure? B3E gives US banks a dilemma – adopt expanded risk-based approach, or a new standardised alternative
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