Featured Product

    HKMA Proposes Revisions to Group-Wide Approach to Supervision of Banks

    December 01, 2020

    HKMA proposed revisions to the Supervisory Policy Manual module CS-1 on group-wide approach to supervision of locally incorporated authorized institutions. The policy module describes the group-wide approach of HKMA for the supervision of authorized institutions where they form part of a financial or a commercial group, either as the head of the group (in case of a financial group) or as one of the member companies of the group (in case of a financial or a commercial group). The consultation will run until February 01, 2021.

    In line with the Core Principles for Effective Banking Supervision, when HKMA supervises an authorized institution, it considers the consolidated risks of that authorized institution's banking group (typically, its immediate holding company, offices, subsidiaries, affiliates, and joint ventures, both domestic and foreign). When the banking group of an authorized institution is part of a wider group, with other group companies (both financial and non-financial) ultimately headed by a common holding company, the risks that could be posed to the authorized institutions by these group companies are also considered. In Hong Kong, the structure of a group of which an authorized institution forms a part generally falls into one or more of the following three categories where an authorized institution

    • is heading a financial group with subsidiaries engaging predominately in providing financial services, such as banking, securities, and insurance.
    • and its subsidiaries form part of an international banking group or other supervised financial group (one that is headed by a bank or a regulated holding company in an overseas jurisdiction, including through one or more intermediate holding companies above the authorized institution).
    • and its subsidiaries are part of a group that is headed by an unregulated holding company, which controls entities engaging in financial activities or a wider range of financial and non-financial activities. This covers groups whose main lines of business are non-financial in nature. Where this is the case, HKMA will generally require the authorized institution within the group to be headed immediately by a locally incorporated holding company, to ensure that the banking (and related) activities of the holding company are subject to relevant prudential standards. 

     

    Comment Due Date: February 01, 2021

    Keywords: Asia Pacific, Hong Kong, Banking, Supervisory Policy Manual, Banking Supervision, SPM CS-1, Group-Wide Supervision, HKMA

    Related Articles
    News

    APRA Issues Interim Update to Policy Priorities for 2021 and Beyond

    In a letter addressed to the industry, the Australian Prudential Regulation Authority (APRA) set out an updated schedule of policy priorities for the banking, insurance, and superannuation industries.

    September 24, 2021 WebPage Regulatory News
    News

    EC Adopts Solvency II and Resolution Rules Package for Insurers

    The European Commission (EC) adopted a comprehensive review package of Solvency II rules in the European Union.

    September 22, 2021 WebPage Regulatory News
    News

    OCC Issues Booklets on Regulatory Reporting and Earnings

    The Office of the Comptroller of the Currency (OCC) issued Versions 1.0 of the "Earnings" and "Regulatory Reporting" booklets of the Comptroller's Handbook.

    September 22, 2021 WebPage Regulatory News
    News

    ECB Sets Out Results of Economy-Wide Climate Stress Tests

    The European Central Bank (ECB) published results of its economy-wide climate stress test, which aimed to assess the resilience of non-financial corporates and euro area banks to climate risks.

    September 22, 2021 WebPage Regulatory News
    News

    EBA Examines Implications of Increasing Use of Digital Platforms in EU

    The European Banking Authority (EBA) published a report on the use of digital platforms in the banking and payments sector in European Union.

    September 21, 2021 WebPage Regulatory News
    News

    HKMA Issues Updates on Policy Measures Intended to Ease COVID Impact

    The Hong Kong Monetary Authority (HKMA) published updates on the policy measures that were announced in context of the ongoing pandemic.

    September 21, 2021 WebPage Regulatory News
    News

    ISDA Responds to BCBS Proposal on Treatment of Cryptoasset Exposures

    The International Swaps and Derivatives Association (ISDA), along with several other associations, submitted a joint response to the Basel Committee on Banking Supervision (BCBS) consultation on preliminary proposals for the prudential treatment of cryptoasset exposures.

    September 21, 2021 WebPage Regulatory News
    News

    BIS Quarterly Review Discusses Developments in Fintech and ESG Space

    BIS published the September issue of the Quarterly Review, which contains special features that analyze the rapid rise in equity funding for financial technology firms, the effectiveness of policy measures in response to pandemic, and the evolution of international banking.

    September 20, 2021 WebPage Regulatory News
    News

    BCBS to Consult on Supervisory Practices for Climate Risks by Year-End

    The Basel Committee for Banking Supervision (BCBS) met in September 2021 and reviewed climate-related financial risks, discussed impact of digitalization, and welcomed efforts by the International Financial Reporting Standards (IFRS) Foundation to develop a common set of sustainability reporting standards

    September 20, 2021 WebPage Regulatory News
    News

    OCC Identifies Operational Risk Deficiencies in MUFG Union Bank

    The Office of the Comptroller of the Currency (OCC) issued a Cease and Desist Order against MUFG Union Bank for deficiencies in technology and operational risk governance.

    September 20, 2021 WebPage Regulatory News
    RESULTS 1 - 10 OF 7494