Also in April 2018, the Federal Reserve and the OCC released a proposal to revise the enhanced supplementary leverage ratio (“eSLR”) requirements applicable to the U.S. global systemically important banks (“GSIBs”) and their IDIs and to make conforming changes to the rules which are applicable to U.S. GSIBs relating to TLAC and external long-term debt that must satisfy certain eligibility criteria. In April 2018, the Federal Reserve proposed the introduction of a stress buffer framework that would create a single, integrated set of capital requirements by combining the supervisory stress test results of the CCAR assessment and those under the Dodd-Frank Act with current point-in-time capital requirements. The U.S. banking regulators will be proposing final requirements applicable to U.S. financial institutions. The following chart presents the Basel III minimum CET1 capital ratio during the transitional periods and on a fully phased-in basis under the Basel Risk-based Capital Regulatory Minimums III rules currently in effect. began January 1, 2016 and continued through the end of 2018. As an expansion of the capital conservation buffer, the Firm is also required to hold additional levels of capital in the form of a GSIB surcharge and a countercyclical capital buffer. Under the Federal Reserve’s final rule, the Firm is required to calculate its GSIB surcharge on an annual basis under two separately prescribed methods, and is subject to the higher of the two. The first (“Method 1”), reflects the GSIB surcharge as prescribed by the Basel Committee’s assessment methodology, and is calculated across five criteria: size, cross-jurisdictional activity, interconnectedness, complexity and substitutability. The second (“Method 2”), modifies the Method 1 requirements to include a measure of short-term wholesale funding in place of substitutability, and introduces a GSIB score “multiplication factor”. The following table represents the Firm’s GSIB surcharge. All banking institutions are currently required to have a minimum CET1 capital ratio of 4.5% of risk weighted assets. Certain banking organizations, including the Firm, are required to hold additional amounts of capital to serve as a “capital conservation buffer”. The capital conservation buffer is intended to be used to absorb potential losses in times of financial or economic stress. The capital conservation buffer was subject to a phase-in period that Additional information regarding the Firm’s capital ratios, as well as the U.S. federal regulatory capital standards to which the Firm is subject, is presented in Note 26. For further information on the Firm’s Basel III measures, refer to the Firm’s Pillar 3 Regulatory Capital Disclosures reports, which are available on the Firm’s website (https://jpmorganchaseco.gcs-web.com/financial-information/basel- pillar-3-us-lcr-disclosures). The capital adequacy of the Firm and its IDI subsidiaries, both during the transitional period and upon full phase-in, is evaluated against the Basel III approach (Standardized or Advanced) which, for each quarter, results in the lower ratio. The Firm’s Basel III Standardized Fully Phased-In risk-based ratios are currently more binding than the Basel III Advanced Fully Phased-In risk-based ratios, and the Firm expects that this will remain the case for the foreseeable future. 2018 2017 Fully Phased-In: Method 1 2.50% 2.50% Method 2 3.50% 3.50% Transitional (a) 2.625% 1.75% (a) The GSIB surcharge is subject to transition provisions (in 25% increments) through the end of 2018. 87 JPMorgan Chase & Co./2018 Form 10-K