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Countercyclical capital buffer

The countercyclical buffer is one of the instruments available in Banco de Portugal’s macroprudential toolkit. It corresponds to an additional buffer of Common Equity Tier 1 capital that should be built up to protect the banking sector in periods when risks of system-wide stress are growing due to excessive credit growth. When risks materialize or recede, such an additional capital buffer ensures that the banking sector is better equipped to absorb losses and remain solvent while continuing to provide credit to the real economy.

Section III of title VII-A of the Legal Framework of Credit Institutions and Financial Companies sets the legal basis for the implementation of the countercyclical capital buffer in Portugal. In this regard, Banco de Portugal is responsible for setting and disclosing, on a quarterly basis, the countercyclical buffer rate that applies to all credit institutions and investment firms with credit exposures to the domestic private non-financial sector. The rate shall be set between 0% and 2.5% (of the total risk exposure amount), unless exceptional circumstances justify the setting of a higher rate. 

The buffer rate for each institution, i.e. the “institution-specific countercyclical buffer rate”, is a weighted average of the countercyclical buffer rates that apply in the countries where the credit exposures of that institution are located. Buffer rates up to 2.5% must be mutually and automatically reciprocated if set by other EU/EEA Member States. If set by third countries authorities, buffer rates up to 2.5% must be recognised provided that the third country countercyclical capital buffer framework is deemed as equivalent by Banco de Portugal. When buffer rates set by other EU/EEA Member States or third countries are above 2.5%, Banco de Portugal will decide on their recognition on a case by case basis.

Credit institutions should apply a decision to raise the countercyclical capital buffer rate within 12 months, unless the Banco de Portugal establishes that the measure should be applied at an earlier date, where warranted by duly substantiated exceptional circumstances.

When announcing a cut in the rate, the Banco de Portugal also informs the institution about the indicative period during which no increase in the countercyclical capital rate is expected.

Decision on the countercyclical buffer rate relevant for exposures to domestic counterparties:

0% of the total risk exposure amount as of 1 October 2023

Background document

Underlying data


Tentative date for next decision: 29 December 2023

Previous decisions

3rd Quarter 2023 - Background document
3rd Quarter 2023 - Underlying data

2nd Quarter 2023 - Background document
2nd Quarter 2023 - Underlying data

1st Quarter 2023 - Background document
1st Quarter 2023 - Underlying data

4th Quarter 2022 - Background document
4th Quarter 2022 - Underlying data

3rd Quarter 2022 - Background document
3rd Quarter 2022 - Underlying data

2nd Quarter 2022 - Background document
2nd Quarter 2022 - Underlying data

1st Quarter 2022 - Background document
1st Quarter 2022 - Underlying data

4th Quarter 2021 - Background document
4th Quarter 2021 - Underlying data

3rd Quarter 2021 - Background document
3rd Quarter 2021 - Underlying data

2nd Quarter 2021 - Background document
2nd Quarter 2021 - Underlying data

1st Quarter 2021 - Background document
1st Quarter 2021 - Underlying data

4th Quarter 2020 - Background document
4th Quarter 2020 - Underlying data

3rd Quarter 2020 - Background document
3rd Quarter 2020 - Underlying data

2nd Quarter 2020 - Background document
2nd Quarter 2020 - Underlying data

1st Quarter 2020 - Background document

1st Quarter 2020 - Underlying data

4th Quarter 2019 - Background document
4th Quarter 2019 - Underlying data

3rd Quarter 2019 - Background document
3rd Quarter 2019 - Underlying data

2nd Quarter 2019 - Background document
2nd Quarter 2019 - Underlying data

1st Quarter 2019 - Background document
1st Quarter 2019 - Underlying data

4th Quarter 2018 - Background document
4th Quarter 2018 - Underlying data

3rd Quarter 2018 - Background document
3rd Quarter 2018 - Underlying data

2nd Quarter 2018 - Background document
2nd Quarter 2018 - Underlying data

1st Quarter 2018 - Background document
1st Quarter 2018 - Underlying data

4th Quarter 2017 - Background document
4th Quarter 2017 - Underlying data

3rd Quarter 2017 - Background document
3rd Quarter 2017 - Underlying data

2nd Quarter 2017 - Background document
2nd Quarter 2017 - Underlying data

1st Quarter 2017 - Background document
1st Quarter 2017 - Underlying data

4th Quarter 2016 - Background document
4th Quarter 2016 - Underlying data

3rd Quarter 2016 - Background document
3rd Quarter 2016 - Underlying data

2nd Quarter 2016 - Background document
2nd Quarter 2016 - Underlying data

1st Quarter 2016 - Background document
1st Quarter 2016 - Underlying data

Countercyclical buffer rates relevant for exposures to foreign counterparties:

EU/EEA Member States

Basel Committee member jurisdictions


Material third countries for the Portuguese banking system:

2023-2024 List of material third countries (updated June 2023)


Tentative date for list update: 28 June 2024

Related documents

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