In addition to the capital adequacy ratio, the Bank of Mauritius introduced a capital conservation buffer of 2.5%, with its implementation staggered over a period of 4 years. A first tranche of 0.625% became effective on 1 January 2017 and thereafter on every 1 January, the capital conservation buffer would increase by a tranche of 0.625% until it reaches 2.5% on 1 January 2020.
In lieu of the counter-cyclical capital buffer, the Bank of Mauritius introduced macro-prudential measures to limit the build-up of risks in three key economic sectors, which had witnessed unprecedented growth rates.