The Financial Stability Board’s annual list of the world’s too big to fail banks was released today. Since 2011 the FSB, an international body that monitors and makes recommendations about the global financial system, has ranked the group of global systemically important banks (G-SIBs) in order of extra capital they require.
Topping the list was JP Morgan and HSBC, which means that they both need to
gain an extra 2.5% of capital on top of an additional 7% which will be required down the road.
This year’s list had 29 banks, compared to last year’s 28, split into five different buffer groups, ranging from 1% to 3.5%. The top group of 3.5% was empty this year.
Citigroup and Deutsche Bank dropped down a group, from 2.5% last year to 2% this year. Bank of America, Goldman Sachs, Morgan Stanley and UBS remain in the 1.5% bracket. Wells Fargo is the only one of the four big banks in the US to sit in the bottom group, requiring them to hold a mere 1% extra.
When asked on their pole position in the list, both JP Morgan and HSBC declined to comment.
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