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ESBG response to EBA leverage ratio recommendations

ESBG response to EBA leverage ratio recommendations

Statement says leverage ratio of 3% ensures backstop measure

​​​BRUSSELS, 4 August 2016


The following statement from ESBG is in response to the EBA Report on the Leverage Ratio Requirements under Article 511 of the CRR.  

ESBG and its members are satisfied that a leverage ratio of 3% will ensure that it remains a backstop measure and therefore will not unduly punish customers with increased costs and/or a reduced supply of credit in the market.

The EBA decision not to differentiate Leverage Ratio by business model is disappointing from ESBG's point of view. Our members operate diverse business models which by their nature are low-risk and this should be reflected by exempting some business models for the Leverage Ratio and providing for a different Leverage Ratio for others. It is disappointing that the EBA saw fit to recommend exemption for securities clearing and settlement houses but not for the smallest banks.

The lack of transparency in gathering data for this report has also caused concern to our members. The EBA has not provided any clarity regarding banks sampled, how it decided on the allocation of banks into different business models and even the countries sampled or amount of banks sampled per country. Without this knowledge it is difficult to judge whether the figures presented are truly representative.


Capital Requirements Directive and Regulation; Leverage ratio; European Institutions; European Supervisory Authorities (EBA-ESMA)