For example, in the UAE we impose the following capital ratios: –  Tier 1 core capital: a minimum of 8% (actual is: 14.5%)  –  Tier 1 and other tiers: a minimum of 12% (actual is: 20.5%)  2. However, it is suggested that local regulators should allow identified D-SIBs a comprehensive grace period to fully comply with the HLA requirements. 3.
As local debt markets are at an infancy stage in many countries in the region, this would make it difficult for potential D-SIBs to hold high-quality liquid debt instruments as “pre-emptive” liquidity buffers against early signs of stress. Hence, there is a need to find an appropriate way to deal with this issue, until debt markets in the region witness significant improvements.