Newsletter December 2013: Chinese bank joins systemic list

BASEL – The Financial Stability Board (FSB) has published an amended list of Global Systemically Important Banks (G-SIBs) that face a supplementary capital buffer to protect against their failure. For the first time, a Chinese bank – Industrial and Commercial Bank of China (ICBC) – joins the list in the lowest bucket, with a 1.0% capital ratio surcharge on top of the 7% target level for tier 1 capital ratios. The bank already meets this requirement comfortably, with a Basel tier 1 capital ratio of 10.6% at end-2012. ICBC became the largest bank in the world by tier 1 capital in the 2013 Top 1000 World Banks ranking compiled by The Banker magazine.