Countercyclical Capital Buffer
The countercyclical capital buffer (CCyB) is a time varying capital requirement which applies to in-scope banks and investment firms. It is designed to make the banking system more resilient and less pro-cyclical. Essentially the CCyB will increase the capital requirement of banks when credit growth is "excessive". The CCyB can then be released, partially or fully, either in the case of a period of systemic stress or when credit growth and associated systemic risks recede.
National designated authorities are required to set CCyB rates on a quarterly basis. The Central Bank is the designated authority for setting the CCyB rate in Ireland. The current rate of the CCyB on Irish exposures is 0 per cent. A range of indicators are analysed when deciding the appropriate CCyB rate.