Key Points:
The G-SIB capital requirements apply from 1 January 2016
and are in addition to the Basel III capital conservation and
countercyclical buffers.
On 4 November 2011, the Basel Committee on Banking Supervision
issued its framework for global systemically important banks
(G-SIBs). The framework covers the assessment
methodology for G-SIBs, the magnitude of additional loss absorbency
that G-SIBs should have and the arrangements by which the framework
will be phased in.
Importantly, some of the framework requirements will be subject
to additional testing by March 2012 via updated bank data.
G-SIB framework
The framework assessment methodology is founded on an
indicator-based approach and comprises five broad categories used
to determine a banks systemic importance: size, interconnectedness,
lack of readily available substitutes or financial institution
infrastructure, global (cross-jurisdictional) activity and
complexity. The methodology gives an
