HKMA published two Supervisory Policy Manual modules on Banking (Exposure Limits) Rules (BELR), in the Gazette, as statutory guidelines under section 7(3) of the Banking Ordinance. The Supervisory Policy Manual modules are CR-L-1 on “Consolidated Supervision of Concentration Risks: Banking (Exposure Limits) Rules—Rule 6” and CR-L-5 on “Major Acquisitions and Investments: BELR Part 3.”
The revisions to these two modules are incidental to the implementation of the BELR, which replace the provisions related to exposure limits formerly set out in Part XV of the Banking Ordinance. Most changes to both Supervisory Policy Manual modules are minor in nature such as updates on cross-references (from provisions in the Banking Ordinance to the BELR) and technical details incidental to the BELR implementation (for example, the calculation of tier 1 capital instead of capital base). A more substantial change to CR-L-5 is the elaboration on the new exemptions introduced in the BELR for share acquisitions (that is, acquisition in the insurance business or for trading purposes). These new exemptions were introduced in response to the industry comments received during the making of the BELR.
Keywords: Asia Pacific, Banking, BELR, Supervisory Policy Manual, Concentration Risk, Exposure Limits, Banking Ordinance, Credit Risk, Large Exposures, Basel III, HKMA
Previous ArticleEBA Single Rulebook Q&A: First Update for August 2019
FED finalized a rule that updates capital planning requirements to reflect the new framework from 2019 that sorts large banks into categories, with requirements that are tailored to the risks of each category.
ECB published results of the quarterly lending survey conducted on 143 banks in the euro area.
ESAs published the final draft implementing technical standards on reporting of intra-group transactions and risk concentration of financial conglomerates subject to the supplementary supervision in EU.
EBA published the annual report on asset encumbrance of banks in EU.
MAS revised the guidelines that address technology and cyber risks of financial institutions, in an environment of growing use of cloud technologies, application programming interfaces, and rapid software development.
FED updated the reporting form and instructions for the FR Y-9C report on consolidated financial statements for holding companies.
EBA issued a consultation paper on the guidelines on monitoring of the threshold and other procedural aspects of the establishment of intermediate EU parent undertakings, or IPUs, as laid down in the Capital Requirements Directive.
EC published Regulation 2021/25 that addresses amendments related to the financial reporting consequences of replacement of the existing interest rate benchmarks with alternative reference rates.
BIS published a bulletin, or a note, that examines the cyber threat landscape in the context of the pandemic and discusses policies to reduce risks to financial stability.
HM Treasury, also known as HMT, has updated the table containing the list of the equivalence decisions that came into effect in UK at the end of the transition period of its withdrawal from EU.