National Bank of Belgium keeps the capital buffer rate at 0%
The National Bank of Belgium (NBB) decided on 14 September 2021 to maintain the so-called countercyclical buffer (CCyB) rate at 0 % for the fourth quarter of 2021. Belgian financial institutions therefore do not need to hold any extra capital buffer for their credit risk exposures to non-financial corporations.
Every quarter, the National Bank takes a decision on this temporary macroprudential buffer under its powers laid down in the 2014 Belgian Banking Law.
Back in March 2020, the NBB had announced that the countercyclical buffer could be fully released on account of the economic challenges presented by the emerging pandemic. It is now not expected to raise the buffer rate at least until the second quarter of 2022.
The NBB’s decision is based on current projections and risk assessments. For the moment, the Bank is treating one of the indicators, known as the credit gap, with caution because it has risen sharply as a result of the big drop in GDP triggered by the lockdown measures.
The NBB will review the situation on a quarterly basis.