Regulatory Alerts2022-12-01
Standards for Capital Adequacy of Banks in the UAE
The Central Bank of the UAE issued these standards to align local banking capital requirements with Basel II and Basel III frameworks, establishing a minimum total capital adequacy ratio of 10.5% for all licensed banks. The document defines eligible Tier 1 and Tier 2 capital components, mandates specific capital buffers including the countercyclical buffer, and imposes stricter leverage ratios for Domestic Systemically Important Banks. It further details risk-weighted asset calculations for credit, market, and operational risks while requiring consolidated reporting and independent internal reviews to ensure financial stability.
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