24 May 2016

Prudential Data Report: EU GSIBs Prudential Capital and Liquidity - Q1 2016

Highlights

European systemically important banks (or EU-GSIBs1) have improved their capital, leverage and liquidity positions in compliance with the Basel III accord (or CRDIV in Europe).

The CRDIV rules comprise minimum requirements on capital adequacy, liquidity and leverage positions, which seek to enhance the soundness of bank’s balance sheets. Notwithstanding the unfounded market turbulence during the first quarter of 2016, EU GSIBs’ capital and liquidity ratios remained resilient in times of stress and above the minimum requirements set by the CRDIV rules.

Among the main findings of this report are:

  • EU GSIBs have increased their end-point Common Equity Tier 1 Capital ratio (CET1 ratio) to 11.9% in 1Q16, from 10.0% in 2013.
  • End-point Tier 1 ratios increased to 13.1% in 1Q16, from 10.7% in 2013.
  • Leverage ratios calculated on an end-point basis have improved over the last three years, to 4.6% in 1Q16 from 3.7% in 2013.
  • Available information indicates the weighted average Liquidity Coverage Ratio (LCR) stood at 127.5% in 1Q16, above the minimum required by 1 January 2018 (100%).