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Sweden's FSA eyes 1 percent countercyclical buffer for banks
May 21, 2014 / 8:27 AM / 4 years ago

Sweden's FSA eyes 1 percent countercyclical buffer for banks

STOCKHOLM, May 21 (Reuters) - Sweden’s Financial Supervisory Authority said on Wednesday it deemed a one percent countercyclical buffer for the country’s banks as reasonable and that such a capital demand could be introduced from summer 2015.

That would take total core tier one capital demands for Nordea, Handelsbanken, Swedbank and SEB to between 14 and 19 percent as a percentage of risk-weighted assets, or on average 16.4 percent, it said.

“The capital demand should be especially high for the big, systemically important banks since the consequences should they run into trouble could be very serious for the broader economy,” FSA chief Martin Andersson said in a statement on its website.

“Our view is that the banks should be restrained with dividends and buybacks going forward in order to meet higher capital needs.” (Reporting by Mia Shanley and Daniel Dickson, editing by Simon Johnson)

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