European banks set for 18.6% capital hike under Basel III
Model output floor and higher credit and op risk charges will drive most of the increase
Large European banks are expected to see their average Tier 1 capital requirements increase 18.6% under the fully-loaded Basel III rules from end-2018 levels, figures from the Basel Committee shows.
The average capital increase for European Group 1 banks – internationally active firms with more than €3 billion ($3.3 billion) in Tier 1 capital – is driven by the introduction of the output floor (+7.4%), as well as changes to required capital for credit risk (+4%), operational risk (+3.7%)
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