The BOE has just announced that UK lenders will have to hold more capital as part of the ring-fencing arrangements introduced for banks such as HSBC, Barclays and RBS. The add-on is 3% of total assets for large firms and is a new layer of special capital to mitigate systemic risks to be in place by 2019. The BOE estimates that this new systemic capital buffer will add about half of one percent onto current capital ratios and translates to less than £10 billion across the UK financial system. The buffer percentage steps up from 1% to 3% as bank size grows and applies to banks and builders that are £25 billion in deposits or larger.
Beyond this systemic risk buffer, there is still serious talk of a counter-cyclical buffer that would kick in smooth out the ups and down of economic activity. Further information on this development can be found here: http://www.reuters.com/article/us-britain-boe-banks-idUSKCN0V716H.
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