The EBA Updates Data Used For The Identification Of Global Systemically Important Institutions (G-SIIs)
The European Banking Authority (EBA) published today 12 indicators and underlying data from the 35 largest institutions in the EU, whose leverage ratio exposure measure exceeds EUR 200 bn. In 2015, the number of banks with a leverage ratio exposure measure exceeding EUR 200 bn was 36 and 3 banks have changed in the sample. This end-2016 data contributes to the internationally agreed basis on which a smaller subset of banks will be identified as global systemically important institutions (G-SIIs), following the Basel Committee on Banking Supervision (BCBS) and the Financial Stability Board (FSB) final assessments.
A stable sample of 33 institutions shows that aggregate values for over-the-counter (OTC) derivatives decreased by 8% from end-2015 and by 28% from end-2013, while for Trading and Available for Sale Securities, the total amount decreased by 7% from end-2015 and by 33% from end-2013. Total exposures for these 33 institutions, as measured for the leverage ratio, observed a decrease by 2.1% and stood at EUR 24.6 trillion at the end of 2016.
The EBA defines uniform requirements for the data used in the identification and scoring of potential G-SIIs, in line with the internationally agreed standards. The EBA also acts as a central data hub in the disclosure process, providing a platform to aggregate data across the EU through a user-friendly excel tool. The EBA will continue to disclose this data on a yearly basis.
Background and legal basis
The EBA Implementing Technical Standards (ITS) and Guidelines on disclosure of G-SIIs define uniform requirements for disclosing the values used during the identification and scoring process of G-SIIs, in line with the internationally agreed standards developed by FSB and the BCBS.
To promote a level playing field in the EU regarding these requirements and increase transparency on the internal financial market, the current level of disclosure goes beyond the minimum standards required by the BCBS, both in terms of granularity of the disclosed information and applicable scope of institutions. Consequently, some of the group-specific templates currently published belong to institutions that have not contributed directly to the BCBS's G-SIB exercise.
The Regulatory and Implementing Technical Standards and the Guidelines have been developed in accordance with Directive 2013/36/EU (Capital Requirements Directive - CRD IV), and on the basis of internationally agreed standards, such as the framework established by the FSB, as well as the standards developed by the BCBS.
The identification of a G-SII, which leads to a higher capital requirement, falls under the responsibility of national competent authorities and will be updated by December 15 every year. The identification will be based on the disclosure of global denominators and G-SIB exercise results, which are expected to be published by the BCBS and the FSB in November each year. The higher capital requirement will then apply after about one year from the publication by competent authorities of banks' scoring results, thus allowing institutions enough time to adjust to the new buffer requirement.
- Technical standards for the identification of global systemically important institutions (G-SIIs)
- Guidelines for the identification of global systemically important institutions (G-SIIs)
- Global Systemically Important Institutions (G-SIIs)