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DNB lowers bank buffer requirements to support lending in the context of COVID-19

On 17 March 2020, the De Nederlandsche Bank (DNB) announced it was lowering Dutch National Banks buffer requirements to support lending.

16 Apr 2020

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De Nederlandsche Bank (DNB), the Dutch Authority for the Financial Markets (AFM), the Ministry of Finance and representatives of the Dutch Banking Association (NVB), the Federation of the Dutch Pension Funds and the Dutch Association of Insurers discussed the consequences of the coronavirus outbreak for the Dutch economy and the financial sector.

The strong starting position of the Dutch banking sector allows DNB to temporarily give banks additional leeway to continue business lending and absorb potential losses. In view of current developments, DNB considers this a prudent approach and has decided to take the following measures:

The systemic buffers will be lowered, from its current 3% of global risk-weighted exposures to 2.5% for ING, 2% for Rabobank and 1.5% for ABN Amro.
The introduction of a floor for mortgage loan risk weighting will be postponed.
These measures will remain in force as long as necessary. Once the situation is back to normal, DNB will compensate the systemic buffers reduction by gradually increasing the countercyclical capital buffer to 2% of Dutch risk-weighted exposures.

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DNB lowers bank buffer requirements to support lending during COVID-19

This article was originally published in the March edition of REGWATCH. Read the full edition covering the following jurisdictions:

  • European Union
  • Belgium
  • France
  • Germany
  • Hong Kong
  • Ireland
  • Italy
  • Luxembourg
  • Switzerland
  • United Kingdom

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