Europe’s leading banks look generally well-placed to meet global standards on leverage to be implemented at the start of 2018, according to data compiled by Standard & Poor’s (S&P) Global Market Intelligence.
However, the credit ratings agency (CRA) cautions that compliance could be tested should regulators implement buffers for the biggest banks.
S&P reports sample of European lenders with over €100bn in assets with available data showed that all had at least the 3% ratio of capital to total assets that the Basel III capital adequacy regime will require from 2018. All of the selected banks also posted double-digit common equity Tier 1 ratios, which measure capital as a share of risk-weighted assets.
Globally systemically important banks (G-SIBs) will have to go beyond the 3% Basel minimum, but the format and quantum of the additional requirement have yet to be finalized.
Among the questions is whether banks will be set a higher minimum requirement or a buffer that would allow supervisors to impose restrictions in the event of a breach, notes S&P.
The Basel Committee on Banking Supervision (BCBS) is also yet to determine whether the add-on will be uniform for all G-SIBs or scaled based on the “buckets” used to calculate similar surcharges for the Core Tier 1 (CET1) ratio.
The top five sectors Asian fintech investors are interested in are data analytics, blockchain, lending, payments and regtech, according to Gary Hwa, EY regional managing partner.
On the third day of the Singapore Fintech Festival conference, there was a focus on specific applications of fintech innovation. One was trade finance, which is clearly is ripe for a revolution.
Kicking off day two of the Singapore Fintech Festival, Deloitte Chairman David Cruikshank said that fintech is significant for three reasons. First, customer expectations of services are higher than ever. Second, barriers to entry are lower than before. And finally, financial institutions (FIs) face a threat of what a competitor might do.
The EU and US’ shift in accounting standards may bring balance sheet losses and increase credit risk, according to James Elder, director of risk services at Standard & Poor’s (S&P) Global.