Capital requirements for Swedish banks

Finansinspektionen presents positions to ensure that the Swedish banking system stands more robustly equipped to withstand future financial crises.

The information provided by FI can be summarised as follows:

  • The four major Swedish banks are assigned a systemic risk buffer of 3 per cent in common equity Tier 1 capital as of 1 January 2015, and a further 2 per cent in a common equity Tier 1 capital requirement within the framework of Pillar 2, which is in accordance with the agreement between the Riksbank, the Swedish Ministry of Finance and FI regarding higher capital requirements for systemically important banks (the so-called November Accord from 2011).
  • FI is raising the risk weight floor for Swedish mortgages to 25 per cent (from 15 per cent currently).
  • Finanstilsynet in Norway has tightened risk weight requirements for Norwegian mortgages FI will therefore, in the framework of Pillar 2, introduce a risk weight floor for Norwegian mortgages of 25 per cent, like the risk weight floor for Swedish mortgages. The level may need to be adjusted somewhat following discussions with the firms in question.
  • FI implements the supervisory capital assessment in Pillar 2, i.e. the assessment of the individual capital requirement of firms, such that a capital requirement under Pillar 2 is always additional to the capital requirement according to the general capital requirements under Pillar 1. However, FI does not normally intend to make a formal decision on the capital requirement under Pillar 2. Insofar that a formal decision has not been made, the capital requirement under Pillar 2 does not affect the level at which the automatic restrictions on distributions linked to the combined buffer requirement come into effect.
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