HSBC Loses Top Rank

HSBC is no longer one of the two most important banks in the global financial system, and has been replaced by American lender Citi, according to the latest data from the Financial Stability Board, Business Insider reported. The Financial Stability Board released the latest update of its global systemically important banks list on Monday, and HSBC has fallen out of the top bucket of the board’s ranking. The FSB was set up by G20 after the financial crisis—which saw the downfall of Lehman Brothers, and the near collapse of many other institutions—as a global watchdog for the financial sector. One of its responsibilities is to identify banks that are “too big to fail,” which are lenders who are so important to the financial system that their failure would cause widespread economic damage. The banks are split into buckets, with each corresponding to higher loss absorbency requirements based on how important to the global financial system the bank is. The higher the number, the more important the bank and the more capital it will be required to hold.