Politics
EBA Eyes Bigger Role for Banks in Setting Key Capital Buffer
Key Points
EBA Eyes Bigger Role for Banks in Setting Key Capital Buffer Europe’s top banking regulator said watchdogs should rely more on banks to calculate how big of a safety cushion they need on top of their minimum capital requirements. The European Banking Authority suggested that supervisors set the non-binding regulatory measure known as Pillar 2 Guidance when they deem a lender’s own management buffer to be too thin under stress or when its capital planning isn’t sufficiently conservative.
EBA Eyes Bigger Role for Banks in Setting Key Capital Buffer
Europe’s top banking regulator said watchdogs should rely more on banks to calculate how big of a safety cushion they need on top of their minimum capital requirements.
The European Banking Authority suggested that supervisors set the non-binding regulatory measure known as Pillar 2 Guidance when they deem a lender’s own management buffer to be too thin under stress or when its capital planning isn’t sufficiently conservative.