Featured Product

    HKMA Issues Proposal Under Derivatives Regime, Extends SFG Loan Scheme

    April 01, 2022

    The Hong Kong Monetary Authority (HKMA) and the Securities and Futures Commission (SFC) concluded a consultation on the addition of new calculation periods and launched a consultation on the annual update to the list of financial services providers, under the over-the-counter (OTC) derivatives regulatory regime. Announcements also included enhancements to the small and medium enterprise (SME) Financing Guarantee Scheme (SFGS), which will take effect from April 01, 2022.

    The Financial Secretary in its 2022-23 budget announced that the maximum loan amount per enterprise under the Special 100% Loan Guarantee will be raised from the total amount of employee wages and rents for 18 months to that for 27 months, subject to a ceiling of HKD 9 million (originally HKD 6 million) and the maximum repayment period will be extended from eight years to ten years. Eligibility criteria for this includes enterprises that have been operating for at least three months as of March 31, 2022 and have suffered at least a 30% decline in sales turnover in any month since February 2020 compared with the monthly average of any preceding quarter from January 2019 to March 2022. In addition, the principal moratorium arrangement for the 80% Guarantee Product, the 90% Guarantee Product, and the Special 100% Loan Guarantee of the SME Financing Guarantee Scheme will be extended by six months to a maximum of 30 months in total. An option for borrowers to resume making partial principal repayment for one year will be provided, allowing borrowers to resume normal repayment gradually if they are willing and capable. The application period of the SME Financing Guarantee Scheme has been also extended to June 30, 2023.

    With respect to the OTC derivatives regime, one new entity (Nomura Financial Products Europe GmbH) is proposed to be included in the financial service provider list. Comment period on the proposed revision to the financial service provider list ends on May 14, 2022 and the conclusion paper for this consultation is expected in June 2022. The updated list targeted to become effective on January 01, 2023. HKMA also informed that the consultation on addition of new calculation periods to the clearing rules received three submissions and the respondents did not have any comments on the proposed amendments. The proposed legislative amendments for adding eight calculation periods to the clearing rules were submitted before the Legislative Council for negative vetting. The amended rules are expected to come into effect on March 01, 2023, subject to the legislative process. 

     

    Keywords: Asia Pacific, Hong Kong, Banking, OTC Derivatives, Financial Service Providers, G-SIBs, Clearing Regime, Credit Risk, SMEs, Loan Guarantee, Basel, Regulatory Capital, Reporting, SFGS, SFC, HKMA

    Featured Experts
    Related Articles
    News

    EU Agencies Update LCR Rule and Macro-Prudential Policy Recommendation

    The European Commission (EC) published the Delegated Regulation 2022/786 with regard to the liquidity coverage requirements for credit institutions under the Capital Requirements Regulation (CRR).

    May 23, 2022 WebPage Regulatory News
    News

    EBA Publishes Regulatory Standards to Identify Shadow Banking Entities

    The European Banking Authority (EBA) published the final draft regulatory technical standards specifying the criteria to identify shadow banking entities for the purposes of reporting large exposures.

    May 23, 2022 WebPage Regulatory News
    News

    EIOPA Examines Physical Climate Risk Exposure, SII Non-Compliance

    The European Insurance and Occupational Pensions Authority (EIOPA) published a report assessing insurers' exposure to physical climate change risks

    May 20, 2022 WebPage Regulatory News
    News

    NGFS Report Explores Quantification of Climate Risk Differentials

    The Network for Greening the Financial System (NGFS) published two reports to aid central banks and regulators in their oversight of the financial sector and in their central bank operations

    May 19, 2022 WebPage Regulatory News
    News

    EC Publishes Results on Review of Web Accessibility Directive

    The European Commission (EC) published the results of a public consultation, held in October 2021, on the review of the Web Accessibility Directive.

    May 19, 2022 WebPage Regulatory News
    News

    MAS Consults on Adjustment Spreads for Conversion of SOR Contracts

    The Monetary Authority of Singapore (MAS) and the SC-STS are jointly consulting, until June 10, 2022, on setting adjustment spreads for the conversion of legacy SOR contracts to SORA reference rate.

    May 18, 2022 WebPage Regulatory News
    News

    OSFI Discusses Benchmark Rate Transition, Sets Out Work Priorities

    The Office of the Superintendent of Financial Institutions (OSFI) published the strategic plan for 2022-2025 and the departmental plan for 2022-23.

    May 17, 2022 WebPage Regulatory News
    News

    EBA Proposes Standards to Support Secondary NPL Markets

    The European Banking Authority (EBA) is consulting, until August 31, 2022, on the draft implementing technical standards specifying requirements for the information that sellers of non-performing loans (NPLs) shall provide to prospective buyers.

    May 17, 2022 WebPage Regulatory News
    News

    EU Confirms Agreement on Rules on Cybersecurity and Banking Resolution

    The European Council and the Parliament reached an agreement on the revised Directive on security of network and information systems (NIS2 Directive).

    May 13, 2022 WebPage Regulatory News
    News

    EBA Issues Standards for Crowdfunding Service Providers Under ECSPR

    The European Banking Authority (EBA) published the final draft regulatory technical standards specifying information that crowdfunding service providers shall provide to investors on the calculation of credit scores and prices of crowdfunding offers.

    May 13, 2022 WebPage Regulatory News
    RESULTS 1 - 10 OF 8206