November 27, 2019 / 5:01 PM / in 3 months

Swedish FSA proposes higher capital buffers for banks exposure to commercial real estate

STOCKHOLM, Nov 27 (Reuters) - Sweden’s financial watchdog proposed on Wednesday higher capital buffers for banks to cover increased risks from lending to the commercial real estate sector.

The FSA said it had set risk weights at between 25% and 35% for exposure to different kinds of commercial real estate. It said the additional capital would amount to about 5 billion Swedish crowns ($519.42 million) for each of the three big banks.

The FSA said in May that Sweden’s financial system is robust but that banks should have larger capital buffers to deal with potential risks in lending to the sector. ($1 = 9.6261 Swedish crowns) (Reporting by Helena Soderpalm; editing by Simon Johnson)

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