BNM is consulting on the policy framework for the domestic systemically important banks (D-SIBs). In addition, financial institutions are required to prepare and submit information based on the reporting template provided for the period ending December 31, 2018. Responses to the consultation, including the completed reporting template, must be submitted by May 15, 2019.
The policy framework for D-SIBs is applicable to licensed banks, licensed investment banks, licensed Islamic banks, and financial holding companies. The exposure draft (consultation paper) outlines the assessment methodology to identify D-SIBs in Malaysia, the higher loss absorbency (HLA) requirements applicable to D-SIBs, and the reporting requirements applicable to financial institutions in regard to the framework. BNM, at its discretion, may impose additional requirements and policy measures as deemed appropriate by BNM to manage risks posed by D-SIBs.
The policy framework forms part of the Basel III regulatory reforms and aims to strengthen existing policy tools to address risks posed by D-SIBs. The framework aims to address the regulatory requirements and policy measures that may be applicable to D-SIBs, the intensity of supervisory oversight by BNM, and the macro-prudential surveillance of BNM. The policy document supersedes the Domestic Systemically Important Banks Framework Survey, which was issued on October 10, 2016. This document must be read together with other relevant legal instruments and policy documents issued by BNM, particularly the following:
- Capital Adequacy Framework (Capital Components) and Capital Adequacy Framework for Islamic Banks (Capital Components)
- Capital Adequacy Framework (Basel II – Risk-Weighted Assets) and Capital Adequacy Framework for Islamic Banks (Risk-Weighted Assets)
- STATsmart Reporting Requirements on Data Submission for Reporting Entities
- Liquidity Coverage Ratio
- External Assets and Liabilities Information System (EALIS)—Submission of External Assets and Liabilities Report
- Definition of Small and Medium Enterprises
Comment Due Date: May 15, 2019
Keywords: Asia Pacific, Malaysia, Banking, Basel III, D-SIBs, Reporting, HLA, Islamic Banking, Systemic Risk, BNM
Previous ArticleBCBS Publishes Working Paper on Sectoral Application of CCyB
HKMA announced the publication of a report on fintech adoption and innovation in the banking industry in Hong Kong.
BIS published a working paper that examines the drivers of cyber risk, especially in context of the cloud services.
ECB launched consultation on a guide specifying how the Banking Supervision expects banks to consider climate-related and environmental risks in their governance and risk management frameworks and when formulating and implementing their business strategy.
ECB published an opinion (CON/2020/16) on amendments to the prudential framework in EU in response to the COVID-19 pandemic.
EBA published a report that examines the interlinkages between recovery and resolution planning under the Bank Recovery and Resolution Directive (BRRD).
SRB published the final Minimum Requirements for Own Funds and Eligible Liabilities (MREL) policy under the Banking Package.
EIOPA published its risk dashboard based on Solvency II data from the fourth quarter of 2019.
MNB published a statement on loan payments post the announced moratorium, in addition to a set of new questions and answers (Q&A) on supervisory measures and requirements announced amid COVID-19 pandemic.
EBA updated the Single Rulebook question and answer (Q&A) tool for banks.
US Agencies (FDIC, FED, and OCC) published an interim final rule that temporarily revises the supplementary leverage ratio calculation for depository institutions.