Banking sector regulatory capital - 2022 Q1

This quarterly statistical release shows levels of capital and risk-weighted assets for the UK banking sector. It includes breakdowns of the movements in different tiers of capital and risk exposure types, and overall capital ratios.
Published on 08 July 2022

Key points:

  • The Common Equity Tier 1 (CET1) capital ratio for the UK banking sector decreased by 1.5 percentage points on the quarter to 15.3%.
  • The level of CET1 capital decreased by 3% on the quarter, from £461bn to £447bn.
  • There was a 6.2% increase in total risk-weighted assets on the quarter, from £2,749bn to £2,919bn.

Table A: Capital ratios and levels of capital and risk-weighted assets in the UK banking sector (a)

2021 Q1

2021 Q2

2021 Q3

2021 Q4

2022 Q1

One quarter

Four quarters

Ratios (per cent)

Change (percentage points)

Total capital

21.3

21.6

21.8

22.1

20.1

-1.9

-1.2

Tier1

18.4

18.6

18.8

19.1

17.3

-1.8

-1.0

CET1

16.1

16.4

16.5

16.8

15.3

-1.5

-0.8

Values (£ billions)

Change (per cent)

Total capital

594

600

611

606

587

-3.1

-1.2

of which: Tier1

512

517

527

525

506

-3.6

-1.2

of which: CET1

448

454

463

461

447

-3.0

-0.2

of which: Tier2

83

83

83

81

81

0.0

-2.4

Risk-weighted assets

2,787

2,774

2,801

2,749

2,919

6.2

4.7

  • (a) Figures throughout this document may not correspond exactly due to rounding.

Chart 1: Capital ratios for the UK banking sector

Lines represent the total capital ratio, Tier 1 and CET 1 ratio of the UK banking sector over the past 18 quarters. All the three ratios have decreased in 2022 Q1.

Chart 2: Contributions to quarterly change in total capital ratio (a) (b)

Bars represent contributions made by the quarterly percentage changes in the levels of risk-weighted assets (RWAs), tier 1 and tier 2 capital on the quarterly percentage change in total capital ratio over the past six quarters. An increase in RWAs and a decrease in tier 1 capital had a negative impact on the total capital ratio in 2022 Q1.
  • (a) See further details about these data for information on the calculation of these contributions.
  • (b) Data for all charts has been sourced from the banking sector regulatory capital data tables.

Table B: Risk-weighted assets by risk type (£ billions) (a)

2021 Q1

2021 Q2

2021 Q3

2021 Q4

2022 Q1

One quarter

Four quarters

Values (£ billions)

Change (per cent)

Total risk-weighted assets

2,787

2,774

2,801

2,749

2,919

6.2

4.7

Credit and counterparty risk

2,018

2,012

2,032

1,973

2,115

7.2

4.8

Market risk

381

379

384

397

404

1.8

6.0

Operational risk

286

288

291

287

290

1.0

1.4

Credit Valuation Adjustment

75

69

72

67

73

9.0

-2.7

Other

28

26

22

24

37

54.2

32.1

  • (a) The categories of risk-weighted assets used are as defined in the reporting templates in the annexes to the Implementing Technical Standards (ITS) on Supervisory Reporting (Regulation (EU) No 573/2013).

Chart 3: Changes in risk-weighted assets by risk type

Bars represent the breakdown of quarterly changes in the levels of risk-weighted assets (RWAs) by type over the past six quarters. There has been an increase across all the published risk types within RWAs.

Comparison of published capital ratios for the UK and the EU

Capital ratios for the UK banking sector are published by a number of organisations; the Bank of England (BoE), the European Central Bank (ECB), the International Monetary Fund (IMF) and the European Banking Authority (EBA). These ratios are not identical due to differences in firm coverage, use of transitional or endpoint capital, method of averaging and data revisions as explained below. Chart 4 shows a comparison of published capital ratios for the UK in the panel on the left with EU average ratios published by the EBA in the panel on the right. Table C provides descriptions of the underlying datasets and provides links to their definitions.

Chart 4: Comparison of published capital ratios for the UK and the EU