Capital Conservation Buffer: Difference between revisions
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The Capital Conservation Buffer is a macroprudential [[capital adequacy]] requirement for all banks to build up an additional loss-absorbing capital cushion to improve their resilience to stresses. | The Capital Conservation Buffer is a macroprudential [[capital adequacy]] requirement for all banks to build up an additional loss-absorbing capital cushion to improve their resilience to stresses. | ||
The idea is for banks to build up the loss-absorbing cushions outside periods of stress, to be drawn down if losses are incurred in the future. | |||
Under Basel III the CCB is 2.5% of risk weighted assets. | Under Basel III the CCB is 2.5% of risk weighted assets. | ||
(Capital Conservation Buffer is sometimes abbreviated to 'CCoB'.) | |||
== See also == | == See also == | ||
* [[Basel III]] | * [[Basel III]] | ||
* [[Capital adequacy]] | * [[Capital adequacy]] | ||
* [[Capital buffer]] | |||
* [[Capital conservation]] | |||
* [[Capital maintenance]] | |||
* [[Countercyclical buffer]] | * [[Countercyclical buffer]] | ||
* [[CRD IV]] | * [[CRD IV]] | ||
| Line 18: | Line 24: | ||
* [[Stress]] | * [[Stress]] | ||
* [[Total Loss Absorbing Capacity]] | * [[Total Loss Absorbing Capacity]] | ||
[[Category:Accounting,_tax_and_regulation]] | |||
[[Category:The_business_context]] | |||
Latest revision as of 23:40, 29 January 2024
(CCB).
The Capital Conservation Buffer is a macroprudential capital adequacy requirement for all banks to build up an additional loss-absorbing capital cushion to improve their resilience to stresses.
The idea is for banks to build up the loss-absorbing cushions outside periods of stress, to be drawn down if losses are incurred in the future.
Under Basel III the CCB is 2.5% of risk weighted assets.
(Capital Conservation Buffer is sometimes abbreviated to 'CCoB'.)
