Capital Conservation BufferCCB
पुँजी संरक्षण बफर
Also called Conservation Buffer
NRB rules
NRB limit: 2.5% of risk-weighted exposure, held in CET1, above the 8.5% minimum total capital (Class A and national-level Class B under CAF 2015)
NRB Unified Directive 2082, Directive 1, Annex 1.1 (CAF 2015, paras 2.4 and 2.5) · applies from . Limits change with each monetary policy and directive, so check the latest notice before the exam.
An extra layer of Common Equity Tier 1 capital that banks must hold above the regulatory minimum in normal times so that it can be drawn down during stress.
Explained
Basel III introduced the conservation buffer so that banks build capital in good times. CAF 2015 requires a CCB of 2.5% of RWE, held in CET1, over the minimum total capital of 8.5%.
Key rules:
- The buffer constrains distributions only, not operations. A bank in the buffer range can continue business but faces limits on cash or stock dividends, share buybacks and discretionary bonuses.
- A bank with CET1 at exactly the 8.5% total minimum and no other capital has a zero buffer and faces a 100% restriction on distributions.
- If a bank has no positive earnings and CET1 below 7%, it should make no positive net distributions.
- A bank drawing the buffer in stress must have a replenishment plan in its ICAAP; drawing it in normal times to win market share is treated seriously in the Supervisory Review.
Capital funds used for prudential exposure limits exclude the CCB.
Example
A commercial bank with total capital of 10% of RWE meets the 8.5% minimum but is 1% short of the 11% level, so its dividend distribution is restricted until it rebuilds the buffer.
In Nepal
In Nepal the CCB applies under CAF 2015 to commercial banks and national-level development banks. It is why the headline requirement for them is 11%.
सामान्य अवस्थामा न्यूनतम पुँजीभन्दा माथि राख्नुपर्ने अतिरिक्त साधारण शेयर पुँजी (CET1), जुन संकटको समयमा प्रयोग गर्न सकिन्छ।
व्याख्या
बासेल ३ ले राम्रो समयमा पुँजी सञ्चय गराउन संरक्षण बफर ल्याएको हो। CAF 2015 अनुसार ८.५ प्रतिशत न्यूनतम कुल पुँजीमाथि जोखिम भारित एक्सपोजरको २.५ प्रतिशत CET1 का रूपमा बफर राख्नुपर्छ।
मुख्य व्यवस्था:
- बफरले वितरणमा मात्र प्रतिबन्ध लगाउँछ, व्यवसाय सञ्चालनमा होइन। बफर दायरामा परेको बैंकले नगद वा बोनस शेयर लाभांश, शेयर पुनर्खरिद र स्वविवेकीय बोनसमा सीमा भोग्छ।
- CET1 ठीक ८.५ प्रतिशत मात्र भएको र अन्य पुँजी नभएको बैंकको बफर शून्य हुन्छ र वितरणमा शतप्रतिशत प्रतिबन्ध लाग्छ।
- सकारात्मक आम्दानी नभएको र CET1 ७ प्रतिशतभन्दा कम भएको बैंकले वितरण गर्न हुँदैन।
- संकटमा बफर प्रयोग गर्ने बैंकले ICAAP मा पुनः पूर्ति योजना राख्नुपर्छ।
विवेकशील सीमाका लागि गणना हुने पुँजीकोषमा यो बफर समावेश हुँदैन।
उदाहरण
कुल पुँजी १० प्रतिशत भएको वाणिज्य बैंकले ८.५ प्रतिशत न्यूनतम पूरा गर्छ तर ११ प्रतिशतभन्दा १ प्रतिशत कम भएकाले बफर पूरा नहुँदासम्म लाभांश वितरणमा प्रतिबन्ध लाग्छ।
नेपालमा
नेपालमा CAF 2015 अन्तर्गत वाणिज्य बैंक र राष्ट्रियस्तरका विकास बैंकमा यो बफर लागू हुन्छ। यसैकारण तिनको कुल आवश्यकता ११ प्रतिशत भनिन्छ।
Related
Sources
- NRB Unified Directive 2082 (A, B and C class), Annex 1.1 Capital Adequacy Framework 2015Nepal Rastra Bank
- BCBS: Basel III international regulatory framework for banksArticle
Updated