What is systemic risk buffer (SRB)?
systemic risk buffer (SRB) definition and meaning on Finance terms:
A capital buffer applied to the financial sector or to one or more subsets of the sector, in order to prevent and mitigate long-term non-cyclical systemic or macroprudential risks. It has been implemented in Europe via Article 133 CRD IV and must amount to at least 1% of the targeted risk exposure amount to be met with CET1 capital and can be applied to all exposures or to a subset of exposures. A special notification procedure must be followed in order to set the buffer at rates between 3% and 5%. Buffer rates above 5% are possible, but also require special authorisation (e. g. a Commission implementing act). <