Finansinspektionen (FI) believes that securitisation can give rise to risks that are not considered in current regulation. FI is therefore submitting for consultation today the method it intends to use to assess banks’ capital requirement within Pillar 2 for flowback risks during securitisation.
Finansinspektionen (FI) is publishing two consultation memorandums today that will raise the capital requirements primarily for exposures to corporates for banks that use the internal ratings-based approach.
FI noted during the spring that Nordea's reported Probability of Default (PD) as a percentage of its corporate lending was larger than its estimated PD during certain years and in certain markets. In other words, actual PD was higher than the bank's estimated PD.
SvD published information today about FI's supervision of Nordea and the banks' internal models. FI therefore sees a need to describe and make certain clarifications about its supervision and how the capital assessment for Nordea has been handled.
The forthcoming capital requirements for Swedish banks have now been decided. The requirements were presented as early as before the summer. The decision also refers to the countercyclical capital buffer, which shall be 1 per cent.
Today, FI describes how capital requirements for Swedish banks will be devised. The information pertains two capital requirements for systemic risks for the four major banks, considerations regarding the countercyclical capital buffer and the increase to the risk weight floor for Swedish mortgages.