(Finance) – The Bank of Italy has decided to apply to all banks authorized in Italy a systemic risk buffer (SyRB) equal to 1.0 percent of credit and counterparty risk-weighted exposures to residents in Italy. The target rate will have to be 1.0 percent achieved gradually establishing a reserve equal to 0.5 percent of relevant exposures by 31 December 2024 and the remaining 0.5 percent by 30 June 2025. The SyRB must be applied at a consolidated level for groups and at an individual level for non-member banks in groups.
Article 133 of Directive EU/2019/878 (CRD5) grants designated national authorities the power to impose a systemic risk buffer (SyRB) in order to protectprevent and mitigate systemic risks not otherwise covered with other tools macroprudential. The SyRB must be made up of high quality capital (common equity tier 1, CET1).
“The establishment of the reserve will strengthen the ability of the Italian banking system to deal with possible adverse events, even independent of the economic-financial cycle – we read in a note from Bank of Italy – If these events occur, the release of the buffer by the Bank of Italy will provide the banks with useful resources to absorb losses and support the supply of credit to the economy. The Bank of Italy will reassess the level of the reserve at least every two years, or sooner if circumstances require it.”