Basel Committee updates its assessment methodology for global systemically important banks and issues disclosure requirements

The Basel Committee on Banking Supervision has today issued Global systemically important banks: updated assessment methodology and the higher loss absorbency requirement.

When the initial assessment methodology for global systemically important banks (G-SIBs) was issued in November 2011, the Basel Committee noted that certain elements would be developed further before implementation. In particular, it was highlighted that outstanding data issues would be addressed by re-running the assessment framework using updated data and that reporting guidance would be issued to ensure the transparency of the methodology.

As a result of the analysis conducted since the November 2011 publication, including the collection of updated data from banks, the Basel Committee has made certain refinements to the assessment methodology. These refinements, together with the reporting guidance, are set out in the updated framework published today.

To help banks and jurisdictions prepare for the implementation of the G-SIB framework, the Basel Committee intends to finalise and publish, by November 2013, certain elements of the regime one year in advance of timeline set out in the November 2011 publication. These elements will enable banks to calculate their scores and higher loss absorbency requirements using end-2012 data, prior to the requirements coming into effect based on end-2013 data. The publication today does not change the date from which the higher loss absorbency requirements start to take effect, which remains 1 January 2016.