EBA calls for binding 3% minimum leverage ratios

CCPs and CSDs should be exempt, authority says

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The London headquarters of the European Banking Authority

The European Banking Authority (EBA) recommended today (August 3) that Europe's financial institutions adopt a compulsory 3% minimum leverage ratio as a binding ‘Pillar 1' requirement, except for central counterparties (CCPs) and central securities depositories (CSDs). The leverage ratio should be based on an institution's Tier 1 capital, the EBA said.

It should apply to "all credit institutions within the scope" of the European Commission's Capital Requirements Regulation (CRR) and fourth

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