Application of a countercyclical capital buffer in Greece
21/03/2022 - Press Releases
- The Bank of Greece assesses the intensity of cyclical systemic risk and the appropriateness of the countercyclical capital buffer (CCyB) rate for Greece on a quarterly basis.
- If the CCyB rate remains unchanged, the Bank of Greece publishes the applicable rate in a Press Release on its website along with a justification for that rate.
- The Bank of Greece sets or adjusts the CCyB rate only if deemed necessary.
Executive Committee Act 202/1/11.03.2022 was posted today on the Bank of Greece website. This Act revises the implementation procedure for applying, and the methodology for setting, the CCyB rate and repeals Executive Committee Act 55/18.12.2015. The revised procedure and methodology are consistent with the simplified CCyB application procedure laid down in Directive (EU) 2019/878 (Capital Requirements Directive V – CRD V) and transposed into Greek law by means of the revised provisions of Article 127 of Law 4261/2014.
According to the revised procedure, the Bank of Greece assesses the intensity of cyclical systemic risk and the appropriateness of the CCyB rate for Greece on a quarterly basis, taking into account the standardised credit-to-GDP gap, and, principally, the additional indicators for the accumulation of cyclical systemic risk set out in more detail in Executive Committee Act 202/1/11.03.2022.
If the Bank of Greece assesses that the current level of the CCyB rate is appropriate and should therefore remain unchanged, it shall publish a Press Release containing the following information: (a) the applicable CCyB rate, (b) the credit-to-GDP ratio and the standardised credit-to-GDP gap, (c) the buffer guide, and (d) the justification for the CCyB rate.
If deemed necessary, the Bank of Greece shall set or adjust the CCyB rate and publish a decision in the form of an Executive Committee Act, in accordance with the applicable provisions of Law 4261/2014.
Further info:
A countercyclical capital buffer (CCyB) is a macroprudential policy tool aimed at preventing the build-up of cyclical systemic risks and at ensuring an appropriate level of credit growth and leverage, both in the upward and the downward phase of the business cycle.
For more details on macroprudential policy, please visit the Bank of Greece website
Related link:
Executive Committee Act 202/1/11.03.2022 (in Greek)