Given this, there is a lot of international work on trying to alleviate the consequences for the economy when the banking system is subject to shocks. For instance, several countries have developed a framework within the Financial Stability Board (FSB) for how banks in distress can be wound up without too much impact on taxpayers. This framework has been introduced through an EU directive into Swedish legislation in the act on resolution. I welcome these standards. But in addition to these standards regarding resolution, it is important that we conduct global crisis prevention work that reduces the risks that banks will suffer problems. And as I mentioned, this work is largely done within the scope of the Basel Committee. Why are globally-harmonised capital requirements a good idea? Much of the Basel Committee's more than forty years of work has concerned capital levels in the banks, and for good reasons. Then as now, our assessment is that wellcapitalised banks benefit financial stability and contribute to a positive development in society. Banks that are well-capitalised are more resilient to losses and have greater capacity to obtain market funding during times of financial unease. In other words, the risk of a financial crisis declines if the banks are well-capitalised. Up until the end of the 1980s, the regulatory frameworks for banks’ capital levels were relatively different in different countries. In many areas, the existing capital requirements were considered outdated and in need of revision.
Sweden’s special requirements need to be reviewed  Source: Sveriges riksbank  Without saying anything about what a future floor for risk-weighted assets may look like, I will simply assume in my example that no bank’s risk-weighted assets may be less than 75 per cent of what they would have been if the Basel Committee's standardised methods had been used. I would like to point out that this 75 per cent should not be seen as an indication of any future calibration of a floor for riskweighted assets. I have chosen this figure because 75 per cent lies between the 60 and 90 per cent that the Basel Committee mentioned in its consultation document in March 2016.4 Given this assumption, our most recent calculations indicate that the major banks’ aggregated risk-weighted assets would increase from the current SEK 2,800 billion to around SEK 4,500 billion. This would mean an increase in the current risk-weighted assets of more than 50 per cent. If, and I would like to emphasise if, Sweden retains its national special requirements in the future, the banks’ CET 1 capital requirements will increase by more than 50 per cent, or around SEK 300 billion. This would of course be a significant increase from the current capital requirement levels.