Macroprudential policy and financial stability glossary

global systemically important bank

global systemically important institution

See global systemically important institutions (G-SII) buffer

A capital buffer that aims to reduce the moral hazard created by the implicit state support and guarantee of bail-out using taxpayers’ money that such institutions enjoy due to their size, cross-border activities and interconnectedness. It has been implemented in Europe via Article 131 CRD IV and amounts to 1-3.5% of total risk exposure amount, to be met with CET1 capital, depending on the degree of systemic importance of an institution.