This list also provides a good indication of which banks are likely to receive enhanced supervisory and resolution planning oversight. It will be updated each year.
The D-SIB capital surcharge is of particular importance because banks are expected to meet it at all times – unlike the capital conservation buffer and any counter-cyclical capital buffer, which are expected to absorb losses during severe downturns. Banks that are part of a Global Systemically Important Bank (G-SIB) banking group are expected to meet the higher of the G-SIB surcharge and any D-SIB surcharge.
The list indicates some areas of divergence of approach across countries:
- Most countries appear to have applied strictly the December 2014 EBA guidelines for identifying O-SIIs. Some, however, have made use of the local supervisory judgement option to designate a wider range of banks as D-SIBs – and therefore the list is not strictly comparable across the internal EU boundaries.
- In Germany, 11 out of 16 D-SIBs have been included on the basis of supervisory judgement; 8 out of 16 in the UK; 3 out of 9 in Hungary; 2 out of 6 in Denmark; and 2 out of 7 in Austria.
- Most countries have applied a range of capital surcharges to their D-SIBs, reflecting the extent of their domestic systemic importance (following the Basel Committee approach to G-SIBs). However, a few countries have applied the same capital surcharge to all their D-SIBs: Norway (2%), Sweden (2%), Greece (1%), and Romania (1%).
- For some banks the D-SIB surcharge is higher than the G-SIB surcharge applied to the global banking group (for example ING and Nordea with a 2% D-SIB surcharge against a 1% G-SIB surcharge), and in some cases it is lower (for example, BNP Paribas with a 1.5% D-SIB surcharge against a G-SIB surcharge of 2%).
- Some countries have not (yet) applied any capital surcharge to their D-SIBs: the UK, Italy and Latvia. In the UK this is because the only use of a bank-specific systemic risk buffer is for ring-fenced retail banks.
- In some countries the D-SIB buffer is in addition to banking sector wide systemic risk buffers: in Norway and Sweden banks are subject to a separate 3% systemic risk buffer (D-SIBs have to meet this in addition to their 2% D-SIB capital surcharge). This is an example of how both the D-SIB buffers and the varying use of macro-prudential instruments across countries is driving sharp differences in minimum capital requirements across banks in Europe.
- Supervisory authorities continue to struggle to determine the extent – if any - to which D-SIB capital surcharges might be offset to some extent by lower Pillar 2 capital requirements.