BoE lowers capital benchmark for first time in a decade
Drop to 13% envisages 0.5pp decline in Pillar 2 add-ons after Basel III
The Bank of England lowered its Tier 1 capital benchmark from 14% to 13% on December 2, the first such cut since the guideline was set in 2015.
The move reflects the regulator’s view that risks in the UK banking sector have fallen, reducing effective capital requirements. The BoE said the final Basel III reforms, due to be implemented on January 1, 2027 in the UK, will improve risk measurement
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