The world’s biggest 13 banks collectively rack up $37bn in capital markets-related regulatory costs each year, according to research by the Association for Financial Markets in Europe (Afme) and PwC. Capital and leverage-related charges are the main culprit, accounting for more than 88% of these regulatory expenses.
The finding is based on 2016 data drawn from banks that account for 70% of capital markets activity. The $37bn figure represents nearly 40% of their total capital markets expenses. Without capital and leverage rules, their annual regulatory expenses would amount to just $4.2bn.
