14th August 2018

The EBA updates data used for the identification of G-SIIs

The European Banking Authority (EBA) has published 12 indicators and updated the underlying data from the 35 largest institutions in the EU, whose leverage ratio exposure measure exceeds EUR200bn.

This end-2017 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. The EBA, acting as a central data hub in the disclosure process, will update this data on a yearly basis and will provide a user-friendly platform to aggregate it across the EU.

A stable sample of 33 institutions shows that aggregate values for level 3 assets decreased by 20% from end-2016 and by 39% from end-2014, while for assets under custody, the total amount increased by 7% from end-2016 and by 16% from end-2013. Intra financial system assets and liabilities both observed a decrease from end-2016, by 6% and 7% respectively. Total exposures for these 33 institutions, as measured for the leverage ratio, decreased by 1.1% and stood at EUR24.3trn at the end of 2017.

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. The identification of a G-SII, which leads to a higher capital requirement, falls under the responsibility of national competent authorities and is updated by 15th December every year.

The identification is 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.