Large Bank Examination Workshop February 2026

Capital Conservation Buffer (CCB)

Capital conservation buffer (% of total risk-weightedassets)

Maximum payout ratio (% of eligible retained income)

Greater than 2.5%

No payout limitation applies

Less than or equal to 2.5%, and greater than 1.875% Less than or equal to 1.875%, and greater than 1.25% Less than or equal to 1.25%, and greater than 0.625%

60%

40%

20%

Less than 0.625%

0%

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Countercyclical Capital Buffer • The countercyclical capital buffer is an extension of the CCB and raises banks’ capital requirements during economic expansions  Banks are required to maintain a higher capital-to-asset ratio when the economy is performing well and loan volumes are growing rapidly. • Conversely, a lower capital-to-asset ratio is required during recessions. • By forcing banks to hold proportionally more capital when their assets grow rapidly (i.e., when they make a lot of loans), regulators can ensure that a larger buffer protects bank solvency should the value of those assets drop.

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