The Financial Stability Board (FSB) today published the 2018 list of global systemically important banks (G-SIBs) using end-2017 data and an assessment methodology designed by the Basel Committee on Banking Supervision (BCBS).
One bank (Groupe BPCE) has been added to the list and two banks (Nordea and Royal Bank of Scotland) have been removed from the list and therefore the overall number of G-SIBs decreases from 30 to 29.
FSB member authorities apply the following requirements to G-SIBs:
- Higher capital buffer: The G-SIBs are allocated to buckets corresponding to of higher capital buffers that national authorities require banks to hold in accordance with international standards. Compared with the 2017 list of G-SIBs, two banks have moved to a lower bucket: Bank of America has moved from bucket 3 to bucket 2 and China Construction Bank has moved from bucket 2 to bucket 1.
- Total Loss-Absorbing Capacity (TLAC): G-SIBs are required by national authorities to meet the TLAC standard, alongside regulatory capital requirements set out in the Basel III framework. The TLAC standard will be phased in from 1 January 2019 for G-SIBs identified in the 2015 list (provided that they continue to be designated as G-SIBs thereafter).
- Resolvability: These include group-wide resolution planning and regular resolvability assessments. The resolvability of each G-SIB is also reviewed in a high-level FSB Resolvability Assessment Process (RAP) by senior regulators within the firms’ Crisis Management Groups.
- Higher supervisory expectations: These include heightened supervisory expectations for risk management functions, risk data aggregation capabilities, risk governance and internal controls.
BCBS today published updated denominators used to calculate banks’ scores and the values of the underlying twelve indicators for each bank in the assessment sample. The BCBS also published the thresholds used to allocate the G-SIBs to buckets, as well as updated links to public disclosures of all banks in the sample.
A new list of G-SIBs will next be published in November 2019.