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EBA clarifies how to identify global systematically important institutions

The European Banking Authority (EBA) has published a chart setting out how to identify global systematically important institutions (G-SIIs) in the European Union. 30 Jul 2015

The chart covers the size, interconnectedness, substitutability, complexity and cross-jurisdictional claims and liabilities of 37 institutions whose leverage ratio exposure measure was over €200 billion in 2014. Largest on the list is HSBC, followed by BNP Paribas.  

G-SSIs are covered by a specific EBA regulatory framework, which is in line with a framework developed by the Financial Stability Board and the Basel Committee on Banking Supervision, the EBA said. G-SSIs have a higher capital requirement than other financial institutions as they are seen as "too big to fail".

As of January 2015, identification of G-SSIs is the responsibility of national competent authorities. The higher capital requirement will apply about one year after identification by the competent authority, to give institutions time to adjust, the EBA said.

Each institution publishes this information itself, but the EBA acts as a "central data hub", providing a way to aggregate the data in a user-friendly presentation. The EBA will disclose this data annually, it said.