2013 G-SIB Update: 29 Banks Identified.pdf

In November 2011, the Financial Stability Board (FSB) identified an initial group of global systemically important banks (G-SIBs) using a methodology developed by the Basel Committee on Banking Supervision (BCBS). The list of G-SIBs was updated annually based on new data and published by the FSB each November. The FSB and BCBS updated the list of G-SIBs in November 2013, using end-2012 data and an updated assessment methodology published by the BCBS in July 2013. One bank, Industrial and Commercial Bank of China Limited, was added to the list, increasing the overall number from 28 to 29. The group of G-SIBs will be next updated in November 2014. The July 2013 changes to the G-SIB assessment methodology reflect lessons from applying the methodology using data submitted by banks in previous years. The BCBS introduced a cap to one of the five categories of indicators used in the assessment methodology and brought forward the publication of denominators used to calculate banks' scores. The changes in the institutions included in the list and their allocation across buckets reflect the combined effects of data quality improvements, changes in the methodology, and changes in underlying systemic importance. The scores and current assignment of G-SIBs to buckets are provisional, and the assignment relevant for the higher loss absorbency requirement will be based on the best and most current available data prior to implementation. The FSB's November 2011 report and the 2012 update set out policy requirements relating to G-SIFIs and the timetable by which these requirements are to be met. The higher loss absorbency requirements for G-SIBs will be phased in from January 2016, with full implementation by January 2019. G-SIFIs are required to meet higher supervisory expectations for risk management functions, data aggregation capabilities, risk governance, and internal controls. The FSB and standard-setting bodies continue to extend the SIFI framework to other systemically important financial institutions. The FSB has endorsed the methodology and policy measures for identifying global systemically important insurers (G-SIIs) and has identified an initial list of nine G-SIIs. The group of G-SIIs will also be updated annually and published by the FSB each November, starting from November 2014. The FSB will issue a proposed assessment methodology for identifying non-bank non-insurance global systemically important financial institutions (NBNI G-SIFIs) by the end of 2013.