Systemically important institutions buffer

Published: 8/11/2017 Modified: 29/11/2022

The systemically important institutions buffer is a capital buffer used as additional protection for the increased risk arising from a bank's size, its standing in the banking system of the Republic of Croatia and the EU, the significance and size of its cross-border activities and from its interconnectedness or the interconnectedness of the banking group it belongs to with the rest of the financial system.

The improvement of the loss-absorbing capacity of systemically important institutions is a preventive macroprudential tool aimed at limiting contagion that might arise from insolvency or stress situations in general for systemically important institutions.

As from 2016, other systemically important institutions buffer (O-SII) is applied to all banks that have been identified as significant or systemically important due to their size, interconnectedness or noticeable cross-border activities.

In addition, the CNB uses the globally systemically important institutions buffer (G-SII), which is applied to those financial institutions that have been identified according to the G-SIFI[1] criteria agreed among the G20 members. There are no globally systemically important institutions in Croatia. However, some parent banks, owning the capital in Croatian banks, have that status.

The procedure for identifying other systemically important credit institutions and capital buffer requirements for other systemically important credit institutions (7/10/2022)
- Notification on the results of the review of the systemic importance of credit institutions in the Republic of Croatia (29/11/2022)

[1] Globally Systemically Important Financial Institutiton

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