A stable, well-functioning financial market for allA stable, well-functioning financial market for allCapital requirements
The capital requirements are based on principles designed by the Basel Committee that have been implemented both in EU capital adequacy regulations, Swedish laws and FI regulations.
The risk-based capital requirement
Minimum requirement, Pillar 1
The Pillar 1 minimum requirement amounts to eight percent of the total risk exposure amount and it must be covered by at least 75 percent Tier 1 capital, whereof at least 75 percent must be Common Equity Tier 1 (CET 1) capital.
Pillar 2 requirements
FI decides on Pillar 2 requirements in connection with our supervisory review and evaluation of the institutions. In support of the decision, FI uses a number of methods that disclose how we assess and calculate the requirement for specific risks. FI can also decide on Pillar 2 requirements based on other assessments that we make. Pillar 2 requirements shall be covered by at least 75 percent Tier 1 capital, of which at least 75 percent must be CET 1 capital. However, FI can decide on a higher proportion of Tier 1 capital or CET 1 capital.
FI's approaches
Updated Pillar 2 method for assessing flowback risk associated with securitisation (2021-07-13)
FI presents new Pillar 2 method for pension risk in credit institutions (2022-06-03)
Pillar 2 method for assessing additional own funds requirement for credit-related concentration risk (In Swedish) (2020-12-29)
Combined buffer requirement
Systemic risk buffer
FI has introduced a systemic risk buffer of three percent of the total risk-weighted exposure amount that applies to the three major Swedish banks. The buffer must be covered by CET 1 capital. FI may also reciprocate systemic risk buffers implemented by other countries, which can lead to a buffer that exceeds three percent.
Buffer for other systemically important institutes (O-SII-buffer)
The O-SII buffer amounts to one percent of the total risk-weighted exposure amount for the three major Swedish banks and Nordea Hypotek AB. The buffer must be covered by CET 1 capital.
Countercyclical capital buffer
The Swedish countercyclical buffer value is currently set at two percent. The buffer value that the banks report is an average value, weighted by the risk exposure amount, of the countercyclical buffer values applied in countries where the company has exposures. The countercyclical capital buffer must be covered by CET 1 capital.
Capital conservation buffer
The capital conservation buffer amounts to 2.5 percent of the total risk weighted exposure amount and must be covered by CET 1 capital.
Pillar 2 guidance
FI notifies the companies a risk-based guidance in connection with our supervisory review and evaluation process. The guidance is not a formally decided requirement. The guidance must be covered by CET 1 capital.
Updated approach to assessing Pillar 2 guidance for Swedish banks (2023-05-31)
The leverage ratio requirement
Minimum requirement, Pillar 1
The minimum requirement for the leverage ratio amounts to three percent of the leverage ratio exposure amount and must be covered by Tier 1 capital.
Pillar 2 requirement
FI can decide on a Pillar 2 requirement in a similar way as for the risk-based requirement. The Pillar 2 requirement must be covered by Tier 1 capital unless we decide otherwise.
Pillar 2 guidance
FI notifies the companies a leverage ratio guidance in connection with our supervisory review and evaluation process. The guidance is not a formally decided requirement. The guidance must be covered by CET 1 capital.
Disclosure requirements, Pillar 3
Pillar 3 includes requirements for credit institutions to disclose information about their operations. The objective with these requirements is to ensure that counterparties are better able to assess if they want to be a customer, lender or investor in the credit institution.
Effective CET 1 capital headroom
As of February 2025, FI will publish the effective Common Equity Tier 1 (CET 1) capital headroom for banks in its memorandum Capital requirements for the Swedish banks. The effective CET 1 capital headroom shows how much of a bank's own buffer of CET 1 capital – in relation to the risk-weighted capital requirement and the Pillar 2 guidance – is available to cover losses without the bank breaching a regulatory requirement or Pillar 2 guidance.
Last reviewed: 2025-02-28
