Regulatory Alerts2013-05-30
Added
Measurement and Capital Adequacy – Introduction, Applicability and Calculation of Requirements
The Bank of Israel amends Regulation on Sound Banking Practices No. 201 to implement Basel III recommendations by setting minimum capital ratios: a minimum Tier 1 Common Equity ratio of 9% (10% for large banks with consolidated assets >=20% of the system) and a total capital ratio of 12.5% (13.5% for large banks). These requirements are effective January 1, 2014, with compliance deadlines for the higher thresholds set for January 1, 2015, for smaller institutions and January 1, 2017, for larger ones. The regulation also clarifies applicability to banking entities on a consolidated basis and removes the distinction between Pillar 1 and Pillar 2 in the minimum total capital calculation.
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