Countercyclical capital buffer (CCyB)

Updated 20 May 2016

In December 2010, the Basel Committee on Banking Supervision published Basel III: A global regulatory framework for more resilient banks and banking systems which presents the details of global regulatory standards on bank capital adequacy and liquidity, including a countercyclical capital buffer. The countercyclical capital buffer aims to ensure that banking sector capital requirements take account of the macro-financial environment in which banks operate. Its primary objective is to use a buffer of capital to achieve the broader macroprudential goal of protecting the banking sector from periods of excess aggregate credit growth that have often been associated with the build-up of system-wide risk. Due to its countercyclical nature, the countercyclical capital buffer regime may also help to lean against the build-up phase of the credit cycle in the first place. In downturns, the regime should help to reduce the risk that the supply of credit will be constrained by regulatory capital requirements that could undermine the performance of the real economy and result in additional credit losses in the banking system.

The Basel III countercyclical capital buffer is calculated as the weighted average of the buffers in effect in the jurisdictions to which banks have a credit exposure. It is implemented as an extension of the capital conservation buffer. It consists entirely of Common Equity Tier 1 capital and, if the minimum buffer requirements are breached, capital distribution constraints will be imposed on the bank. Consistent with the capital conservation buffer, the constraints imposed relate only to capital distributions, not the operation of the bank.

Banks must ensure that their countercyclical buffer requirements are calculated and publically disclosed with at least the same frequency as their minimum capital requirements. In addition, when disclosing their buffer requirement, banks must also disclose the geographic breakdown of their private sector credit exposures used in the calculation of the buffer requirement.

Jurisdictional reciprocity will be applied when it comes to internationally active banks in member jurisdictions. The countercyclical buffer regime will be phased-in in parallel with the capital conservation buffer between 1 January 2016 and year end 2018 becoming fully effective on 1 January 2019. Countries that experience excessive credit growth during this transition period will consider accelerating the build-up of the capital conservation buffer and the countercyclical buffer. In addition, jurisdictions may choose to implement larger countercyclical buffer requirements. In such cases the reciprocity provisions of the regime will not apply to the additional amounts or earlier time-frames.

The document entitled Guidance for national authorities operating the countercyclical capital buffer, sets out the principles that national authorities have agreed to follow in making buffer decisions. To give banks time to adjust to a buffer level, a jurisdiction will pre-announce its decision to raise the level of the countercyclical buffer by up to 12 months. Decisions by a jurisdiction to decrease the level of the countercyclical buffer will take effect immediately. The pre-announced buffer decisions and the actual buffers in place for all Committee member jurisdictions are published below. A set of frequently asked questions on implementation of the CCyB can be found here. To be notified of updates, subscribe to the designated email alert.

For queries, please write to Basel3CCYB$bis.org (where "$" denotes "@").


Basel Committee member jurisdictions


Jurisdiction


CCyB regulations

Current CCyB

Future CCyB


Table last updated

Policy announcement

Effective date

Add-on (per cent of RWA)

Policy announcement

Effective date

Add-on (per cent of RWA)

Argentina

Compiled text on Profits distribution (in Spanish only) BCRA decision on counter cyclical buffer (Communication "A"5938, 31.03.2016, in Spanish only)

01.04.2016

0.00%

n/a

n/a

n/a

31.03.2016

Australia

Prudential Standard APS 110 - Capital Adequacy

APRA announces countercyclical capital buffer rate for ADIs

01.01.2016

0.00%

n/a

n/a

n/a

17.12.2015

Belgium

Arrèté royal portant approbation du règlement du 24 novembre 2015 de la Banque national de Belgique relatif à la détermination du taux de coussin de conservation des fonds propres de base de catégorie 1 contracyclique (available in French and Dutch only)

Quarterly decision of the National Bank of Belgium on the countercyclical capital buffer rate (21.03.2016)

01.04.2016

0.00%

n/a

n/a

n/a

21.03.2016

Brazil

Implementation of the CCyB in Brazil (Resolution 4,193, 03.01.2013, Articles 8 and 9, as amended by Resolution 4.443, 10.29.2015)

Central Bank of Brazil announces Countercyclical Capital Buffer in Brazil (Circular 3.769, Article 3, 10.29.2015)

Rationale for the CCyB rate in Brazil (Financial Stability Report, 03.2015)

01.01.2016

0.00%

n/a

n/a

n/a

14.12.2015

Canada

Capital Adequacy Requirements

n/a

n/a

n/a

n/a

n/a

n/a

19.10.2015

China

Capital Rules for Commercial Banks (Provisional) (Decree of the CBRC, No 1, 2012) (in English)

Capital Rules for Commercial Banks (Provision), (Decree of the CBRC, No 1, 2012

19.10.2015

France

HCSF decision regarding the CCyB (30.12.2015)

30.12.2015

0.00%

n/a

n/a

n/a

30.12.2015

Germany

German Banking Act (KWG) - Article 10d

BaFin Board Decision regarding the counter cyclical buffer rate (15.12.2015)

01.01.2016

0.00%

n/a

n/a

n/a

15.12.2015

Hong Kong SAR

Implementation of the CCyB in Hong Kong

Monetary Authority Announces Countercyclical Capital Buffer for Hong Kong (27.01.2015)

01.01.2016

0.625%

HK CCyB announcement (14 Jan 2016)

01.01.2017

1.25%

14.01.2016

India

Indonesia

BoI CCyB regulation (available in Indonesian only)

CCyB announcement (available in Indonesian only, 31.12.2015)

01.01.2016

0.00%

n/a

n/a

n/a

04.01.2016

Italy

Bank of Italy's Circular No. 285 - Supervisory instructions for banks (available in Italian only)

Bank of Italy (30 December 2015)

01.01.2016

0.00%

n/a

n/a

n/a

30.12.2015

Japan

Ordinances and notices on capital buffer ratios (available in Japanese only)

Ordinances and notices on capital buffer ratios (available in Japanese only)

31.03.2016

0.00%

n/a

n/a

n/a

31.03.2016

Korea

Notice of the amendments to the banking regulation (in Korean only)

FSC announced CCyB rate for South Korea

31.03.2016

0.00%

n/a

n/a

n/a

31.03.2016

Luxembourg

CSSF Regulation N° 15-04 on the setting of a countercyclical buffer rate (only in French)

CSSF Regulation N° 15-05 on the exemption of investment firms that qualify as small and medium-sized enterprises from the requirements of countercyclical capital buffer and capital conservation buffer (only in French)

CSSF Regulation No 16-02 on the setting of the countercyclical buffer rate for the second quarter of 2016 (only in French, 29.03.2016)

01.04.2016

0.00%

n/a

n/a

n/a

29.03.2016

Mexico

General Provisions Applicable to the Credit Institutions (Chapter VI Bis 2, Title First Bis; in Spanish only)

Cargos de Capital Contracíclico Vigentes (in Spanish only, 06.05.2016)) 

07.04.2016

0.00%

n/a

n/a

 n/a

 07.04.2016 

Netherlands

CRD IV, Articles 135 and 136

ESRB Recommendation on Guidance for Setting CCyB Rates

Financial Supervision Act, Article 3:62a (in Dutch, 13.07.2015)

Decree on prudential rule under the Financial Supervision Act, Article 105

Decree on prudential rule under the Financial Supervision Act, Article 106

DNB handhaaft contracyclische kapitaalbuffer op o procent (12.04.2016)

12.04.2016

0.00%

n/a

n/a

n/a

12.04.2016

Russia

Bank of Russia Ordinance No. 3855-U, dated  30 November 2015, 'On Amending of Bank of Russia Instruction No. 139-I, Dated 3 December 2012, On Banks' Required Ratios' (becomes effective from 1 January 2016) (available in Russian only)

On countercyclical buffer to capital adequacy ratio

01.01.2016

0.00%

n/a

n/a

n/a

24.02.2016

Saudi Arabia

On applicability of the countercyclical capital buffer (04.01.2016)

On applicability of the countercyclical capital buffer (04.01.2016)

01.01.2016

0.00%

n/a

n/a

n/a

28.02.2016

Singapore

MAS Notice 637 on Risk Based Capital Adequacy Requirements for Banks Incorporated in Singapore

n/a

n/a

n/a

Decision on Singapore's countercyclical capital buffer rate for 2017 (MAS Financial Stability Review 2015, Box H)

01.01.2017 

0.00%

30.11.2015

South Africa

Banks Act Circular 8 of 2015 - Countercyclical capital buffer for South Africa based on the Basel III framework

September 2015 - Financial Stability Review (28.10.2015)

01.01.2016

0.00%

n/a

n/a

n/a

28.10.2015

Spain

Articles 130 and 135-140 of the CRD provides legal basis for the implementation of the CCB in Europe. The CCB is one of the macroprudential instruments available to the BdE. Spanish Law 10/2014, Royal Decree 84/2015 and Circular 2/2016 provide for and develop on the implementation of the CCB in accordance with CRR/CRD provisions. Specific provisions on the CCB are mainly concentrated in Title II Chapter III of the Law 10/2014, Title II Chapter II of the Royal Decree 84/201, and Norms 8-12 of the Circular 2/2016.

The Banco de Espana maintains the countercyclical capital buffer at 0% (21.03.2016)

01.04.2016

0.00%

n/a

n/a

n/a

21.03.2016

Sweden

Swedish Buffer Capital Act (in Swedish only)

Regulations regarding the countercyclical buffer rate

Swedish implementation of overal capital requirements, including combined buffer and reciprocity of CCyB

Decision regarding the countercyclical buffer rate (08.12.2014)

13.09.2015

1.00%

Proposal to amend the regulations on the countercyclical capital buffer (26.05.2015)


Regulations amending Finansinspektionen's regulations (FFFS 2014:33) regarding the countercyclical capital buffer rate (21.03.2016)

27.06.2016


19.03.2017

1.50%


2.00%

14.03.2016

Switzerland

Capital Ordinance Article 44 (available in German, French, and Italian)

Stance of the Basel III countercyclical capital buffer in Switzerland, February 2016

16.02.2016

0.00%

n/a

n/a

n/a

16.02.2016

Turkey

Regulation on Capital Conservation Buffer and Countercyclical Capital Buffer (available in Turkish)

Banking Regulation and Supervision Board Resolution on Principles and Procedures on Countercyclical Capital Buffer Implementation and Profit Distribution to be Made by Banks (available in Turkish)

Board Resolution on the Countercyclical Capital Buffer Rate (available in Turkish)

01.01.2016

0.00%

n/a

n/a

n/a

24.12.2015

United Kingdom

Statutory Instruments - Financial Services and Markets: The Capital Requirements (Capital Buffers and Macroprudential Measures) Regulations 2014

The Financial Policy Committee's powers to supplement capital requirements

Financial Policy Committee statement from its policy meeting, 24 March 2015 (26.03.2015)

26.03.2015

0.00%

Financial Policy Committee statement from its policy meeting (23 March 2016)

29.03.2017

0.50%

23.03.2016

United States

See section 11 of the regulatory capital rules for each U.S. federal banking agency:

Federal Reserve Board: 12 CFR § 217.11

Proposed policy statement: Regulatory Capital Rules: The Federal Reserve Board's Framework for Implementing the Countercyclical Capital Buffer (21.12.2015)

Office of the Comptroller of the Currency: 12 CFR § 3.11

Federal Deposit Insurance Corporation: 12 CFR § 324.11

Federal Reserve Board votes to affirm the CCyB amount at the current level of 0 percent for advanced approaches bank holding companies, savings and loan companies, and state member banks (21.12.2015)

21.12.2015

0.00%

 n/a

 n/a

 n/a

10.01.2016 


Non-member jurisdictions


Jurisdiction


CCyB regulations

Current CCyB

Future CCyB


Table last updated

Policy announcement

Effective date

Add-on (per cent of RWA)

Policy announcement

Effective date

Add-on (per cent of RWA)

Norway

Norwegian Financial Institutions Act Section 2-9e (in Norwegian only)

Regulation on the Countercyclical capital buffer (in English)

Regulation regarding the countercyclical buffer level (12.12.2013, ed. 18.06.2015 - in Norwegian)

Regulation regarding the countercyclical buffer level (12.12.2013 - in Norwegian only)

Press release (12.12.2013 - in English)

30.06.2015

1.00%

Press release: Countercyclical buffer increases next year (18.06.2015 - in English)

(Press release: Countercyclical buffer unchanged (24.09.2015 - in English))

30.06.2016

1.50%

19.10.2015