Loss-Absorbing Capacity and Bank Capital: 7 July 2016

Speakers at an FMLC seminar, 7 July 2016. (@FMLC)

In 2009, the G20 acknowledged that the current capital requirements do not deal adequately with the ideal of returning a bank to lending after resolution because they do not provide for a means by which Banks can quickly rebuild their Basel III capital and so meet the requirements for authorisation.  In consequence regulators developed standards on so-called “loss absorbing capacity” which are designed to ensure not only that banks have enough capital to absorb losses but also that they have enough to recapitalise themselves once the flow of losses has been stemmed.

FMLC CEO Joanna Perkins made a presentation on Loss-Absorbing Capacity and Bank Capital to a small group of experts and public sector officials at the offices of Freshfields Bruckhaus Deringer LLP.  While the event was closed to the public, the presentation and Dr Perkins’ comments can be downloaded.