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Financial Stability | Capital Buffers

Countercyclical capital buffer

The countercyclical capital buffer (CCyB) is introduced to mitigate financial procyclicality. This instrument creates an additional buffer of Common Equity Tier 1 capital during periods of excessive credit growth to improve the resilience of the banking sector and reduce the possibility of a financial crisis outbreak. A country’s CCyB rate can be set between 0% and 2.5%, and can be raised in stages by 0.25 pp or multiples of 0.25 pp. This rate can be higher in exceptional circumstances. Rates of this buffer are determined quarterly, based on the deviation of the credit-to-GDP ratio from its long-term trend, taking account of other indicators relevant for monitoring the cyclical dimension of systemic risk.

A historical overview of CCyB rates for the Republic of Serbia:

Date of rate setting Credit-to-GDP ratio** Credit-to-GDP gap Reference guide* The set rate Start of application 
06/09/2019
Explanation

75.3%

-6.7 pp

0%

0%

30/09/2019
06/06/2019
Explanation

73.3%

-8.4 pp

0%

0%

30/06/2019
07/03/2019
Explanation

72.1%

-9.4 pp

0%

0%

31/03/2019
06/12/2018
Explanation

75.3%

–12.9 pp

0%

0%

31/12/2018
06/09/2018
Explanation

75.7%

–12.4 pp

0%

0%

30/09/2018
14/06/2018
Explanation

75.1%

–13.1 pp

0%

0%

30/06/2018
14/03/2018
Explanation

74.9%

–13.3 pp

0%

0%

31/03/2018
07/12/2017
Explanation

76.3%

-14.0 pp

0%

0%

31/12/2017
07/09/2017
Explanation

75.5%

–14.7 pp

0%

0%

30/09/2017
08/06/2017
Decision
Explanation


74.7%


–15.6 pp


0%


0%


30/06/2017

* Starting from March 2018, the buffer guide applied in setting the CCyB rate is the share of loans to the non-government sector in GDP. In the prior period, the buffer guide was the share of lending to the non-government sector in GDP, which, in addition to loans, included given deposits, investment, securities and other financial assets, interest, fees and commission receivables and other lending.

** In late 2018, the Serbian Statistical Office revised the GDP data for 2015 and 2016 and the first published estimates for 2017 (as the sum of four quarters). The data series back to 2005 were revised by the end of 2018, and the data before 2005 (starting from 1995) are yet to be revised, i.e. the revision of the whole series will be completed during 2019 - as in the EU Member States.

A comparative overview of CCyB rates by country is availabe at the ESRB website