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What was the Previous UK Countercyclical Capital Buffer Rate?
5th July 2016
Previous UK CCyB Rate
The Financial Planning Committee (FPC) of the Bank of England (BOE) has today announced a reduction to the UK Countercyclical Capital Buffer rate (CCyB) from 0.5% to 0% of banks’ UK exposures. This is to take immediate effect, thus the UK countercyclical capital buffer rate in July 2016 was 0%.
Following June’s referendum result, the BOE informs in their biannual Financial Stability Report that:
“given the need to give banks the clarity necessary to facilitate their capital planning, the FPC expects to maintain a 0% UK CCyB rate until at least June 2017.”
Bank of England’s FPC on Current UK CCyB Rate, 05Jul16
The BOE also went on to inform that the UK CCyB rate will be continually reviewed on a quarterly basis.
Previous FPC UK CCyB announcements:
Prior to today’s announcement, on 29th March 2016 the FPC had set the UK Countercyclical Capital Buffer Rate at 0.5% of a firm’s risk weighted assets that was due to take effect on 29th March 2017.
The Countercyclical Capital Buffer is capital a firm will have to set aside in relation to jurisdictional exposures
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** On 30 November 2016, the FPC reaffirmed that it expects to maintain a UK CCyB rate at 0% until at least June 2017, absent any material change in the outlook. **
