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(Bloomberg) -- Citigroup Inc. and BNP Paribas SA fell in global regulators’ ranking of banks that pose the biggest threat to the financial system as authorities recommended they face lower capital surcharges.
Citigroup fell one level in the ranking, meaning its extra capital requirement under international standards will be 2 percent of risk-weighted assets, according to the Financial Stability Board’s latest list published on Tuesday. BNP Paribas fell one level as well, leaving it facing a 1.5 percent surcharge. Credit Suisse Group AG also fell in the ranking.
Banking regulators moved after the 2008 credit crisis to increase capital levels across the industry as well as to impose surcharges for lenders deemed to present the biggest and most complex risks to the financial system. The extra capital requirements for systemically important lenders began to take effect in 2016 and are reviewed annually.
The FSB, which is led by Bank of England Governor Mark Carney, coordinates oversight of the most globally systemic banks, while the capital surcharges are implemented by national authorities that are members of the board. European Union bank supervisors have so far imposed the additional capital requirements in line with the FSB recommendations.
Groupe BPCE fell out of this year’s FSB list, while Royal Bank of Canada was added.
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