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Systemic risk buffer: what would this instrument be used for?
[Coussin pour le risque systémique : à quoi servirait cet instrument ?]

Author

Listed:
  • Silvia GABRIEL
  • Ramona JIMBOREAN

Abstract

The systemic risk buffer (SRB) is an additional capital requirement for the banking sector that aims at preventing or mitigating the non-cyclical dimension of risk. Indeed, systemic risks can magnify the impact of financial distress or of an external shock to the economy. They depend on the structural characteristics of the banking sector, in particular its size, degree of concentration and importance for the financing of the economy. They also result from the strength of interconnections between financial institutions and the associated risk of financial contagion. Fourteen countries have activated a SRB since its introduction into European legislation in 2014. As of today, the level of structural systemic risk does not require the implementation of a SRB in France. Le coussin pour le risque systémique (systemic risk buffer, SRB) constitue une exigence de fonds propres supplémentaire à respecter pour le secteur bancaire qui vise à prévenir ou atténuer la dimension non cyclique du risque. En effet, les risques systémiques peuvent amplifier l’impact de difficultés financières ou d’un choc externe sur l’économie. Ils dépendent des caractéristiques structurelles du secteur bancaire, notamment de sa taille, de son degré de concentration et de sa part dans le financement de l’économie. Ils résultent également du degré d’interconnexion entre les établissements financiers et du risque de contagion financière associé. Quatorze pays ont mis en place ce SRB, depuis son introduction dans la législation européenne en 2014. À ce jour, le niveau du risque systémique structurel ne nécessite pas la mise en œuvre d’un SRB en France.

Suggested Citation

  • Silvia GABRIEL & Ramona JIMBOREAN, 2020. "Systemic risk buffer: what would this instrument be used for? [Coussin pour le risque systémique : à quoi servirait cet instrument ?]," Bulletin de la Banque de France, Banque de France, issue 227.
    • Handle: RePEc:bfr:bullbf:2020:227:02
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    References listed on IDEAS

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    2. Carmen Broto & Mariya Melnychuk, 2022. "Structural risk indicators for the Spanish banking sector," Financial Stability Review, Banco de España, issue Autumn.

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    More about this item

    JEL classification:

    • G21 - Financial Economics - - Financial Institutions and Services - - - Banks; Other Depository Institutions; Micro Finance Institutions; Mortgages
    • E44 - Macroeconomics and Monetary Economics - - Money and Interest Rates - - - Financial Markets and the Macroeconomy
    • G28 - Financial Economics - - Financial Institutions and Services - - - Government Policy and Regulation

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