[feb] Capital conservation buffer Flashcards
1
Q
What?
A
introduced under the international Basel III norms.
The concept says that during good times, banks must build up a capital buffer that can be drawn from when there is stress.
In India, the minimum capital requirement is 9 per cent.
The CCB would be 2.5 percentage points over and above the minimum capital requirement
2
Q
Context?
A
Out of the total capital requirement of 11.5% under BASEL III norm, 2.5% is Capital Conservation Buffer and out of this 2.5% , just 0.625% has still not been made effective which the banks are required to do now by 1st Oct 2021.
