The Portuguese macroprudential authority, Banco de Portugal, decided that the list of material third countries, for the purposes of recognising and setting the countercyclical capital buffer (CCyB) rates for exposures to third countries, is composed by the Republic of Mozambique and Macao Special Administrative Region of the People’s Republic of China. This list is valid from July 1, 2023, until June 30, 2024. It did not change compared to the previous year.

The release of the current list is pursuant to the decision of the Board of Directors of the Banco de Portugal of 20th June 2023, based on the results of the assessment exercise to identify material third countries. This exercise is carried out by the Banco de Portugal in compliance with the ESRB’s Recommendation (ESRB/2015/1) on recognising and setting CCyB rates for exposures to third countries.

The CCyB is a macroprudential instrument intended to increase the resilience of the banking sector against cyclical systemic risk from excessive credit growth in the non-financial private sector. Thus, for the purposes of this assessment, only direct exposures of the Portuguese banking system to the private non-financial sector in third countries are taken into account. This assessment does not comprise direct exposures to public sector entities or financial institutions of third countries nor exposures of the Portuguese banking system, via credit granted in Portugal, to non-financial corporations located in Portugal but whose activity is, to some extent, dependent on third countries. 

The Banco de Portugal will review the list of material third countries annually and publish its decision on its website.