Macroprudential policy and financial stability glossary

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S

S&P
Standard & Poor’s
SBBS
sovereign bond-backed security
SCR
See
sectoral capital requirements (SCR)
SCR
Solvency Capital Requirement
sectoral capital requirements (SCR)
The prudential rules for the EU banking system provide for the use of more targeted capital-based tools designed to address vulnerabilities that can appear at sectoral level. They can take the form of stricter requirements for loss given default and higher real estate risk weights, which have been implemented via Articles 124, 164 and 458 CRR.
SII
systemically important institution
Single Resolution Mechanism (SRM)
A mechanism proposed by the European Commission, which establishes uniform rules and a uniform procedure for the resolution of credit institutions established in the banking union. It is envisaged that it will be composed of a single resolution board and national resolution authorities in participating Member States, with ultimate decision-making power at the European level. For the purposes of resolution, the SRM will have at its disposal a single resolution fund. The SRM is a necessary complement to the Single Supervisory Mechanism in order to achieve a well-functioning banking union. See also
Single Supervisory Mechanism (SSM)
Single Supervisory Mechanism (SSM)
A mechanism composed of the ECB and national competent authorities in participating Member States for the exercise of the supervisory tasks conferred upon the ECB. The ECB is responsible for the effective and consistent functioning of this mechanism, which forms part of European banking union.
Single Supervisory Mechanism Regulation (SSMR)
The legal act creating a single supervisory mechanism for credit institutions in the euro area and, potentially, other EU Member States, as one of the main elements of Europe’s banking union. The SSM Regulation (EU) No 1024/2013 confers on the ECB specific tasks concerning policies relating to the prudential supervision of credit institutions and macroprudential policy.
SIPS
See
systemically important payment system (SIPS)
SMEs
small and medium-sized enterprises
SPV
special-purpose vehicle
SRB
See
systemic risk buffer (SRB)
SRM
See
Single Resolution Mechanism (SRM)
SRMR
Single Resolution Mechanism Regulation
SSM
See
Single Supervisory Mechanism (SSM)
SSM Framework Regulation
The regulatory framework setting out the practical arrangements concerning the cooperation between the ECB and the national competent authorities within the Single Supervisory Mechanism: Regulation (EU) No 468/2014.
SSM Regulation
See
Single Supervisory Mechanism Regulation (SSMR)
SSMR
See
Single Supervisory Mechanism Regulation (SSMR)
STE
Short Term Exercise
systemic risk buffer (SRB)
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).
systemically important payment system (SIPS)
A payment system which has the potential to trigger systemic risks in the event of it being insufficiently protected against the risks to which it is exposed.