Rethinking Macroprudential Capital Buffers

2025

Open publication workspace · Sign in to read the full PDF.

AI-generated summary

This paper re-evaluates the design and deployment of macroprudential capital buffers, arguing for a proactive approach to enhance financial stability.

* Examines the effectiveness and limitations of existing capital buffer frameworks, particularly in light of the COVID-19 pandemic.
* Proposes a positive neutral setting for the countercyclical capital buffer (CCyB) as a means to build releasable capital proactively.
* Discusses operational considerations, including calibration, release triggers, and interactions with other prudential requirements.

Tags: macroprudential policy, capital buffers, countercyclical capital buffer, financial stability, banking regulation

Check the original publication for accuracy and context.