The European Banking Authority (EBA) published its recommendation relating to the European bank recapitalisation plan on 8 December 2011. This forms part of a broader set of EU measures agreed in October 2011 to restore confidence in the banking sector. By the end of June 2012, 65 banks must reach a 9% ratio of core Tier 1 capital to risk-weighted assets (RWA). Capital will be assessed net of valuation losses on EEA sovereign exposures incurred by end-September 2011 (“sovereign buffer”). The 31 banks located in the shaded area below the regulatory line (capital = RWA) in Graph A (left-hand.
