Featured Product

    IMF Reports on 2019 Article IV Consultation with Japan and Philippines

    February 10, 2020

    IMF published reports under the 2019 Article IV consultations with Japan and Philippines. The IMF reports assess, among other areas, the soundness of financial sectors in these countries. For Japan, the IMF staff recommends strengthening of the crisis management and resolution framework for banks and introduction of an economic-value-based solvency regime for insurers. For Philippines, the key recommendations are related to the macro-prudential policy measures.

    Staff and selected issues reports on Japan. IMF Directors stressed the need to proactively strengthen the resilience of the banking sector in Japan. They encouraged the authorities to consider tightening macro-prudential policies and stand ready to activate the countercyclical capital buffer (CCyB). They also recommended continued efforts toward further improving financial sector supervision and regulation, the risk assessment process, and the macro-prudential policy toolkit. Directors were encouraged by progress made in implementing the 2017 Financial Sector Assessment Program (FSAP) recommendations. The report recommends that the Financial Services Agency in Japan, or JFSA, should implement some key outstanding recommendations of the 2017 FSAP:

    • As the financial cycle matures, the Authority should continue to strengthen its financial sector supervision and regulation, by intensifying the risk assessment process and completing the macro-prudential policy toolkit, to better identify and mitigate the build-up of systemic risk. 
    • The Authority should strengthen its crisis management and resolution framework, by extending the coverage of total loss-absorbing capacity requirements to all domestic systemically-important banks (D-SIBs). 
    • It should also continue to take steps toward introducing an economic-value-based solvency regime for the insurance sector. 
    • Also recommended is the continued strengthening of the oversight of virtual asset service providers by ensuring that they are subject to Anti-Money Laundering and Combating the Financing of Terrorism (AML/CFT) supervision, in line with the international standards.

    Staff and selected issues reports on Philippines. The main banking sector risks in the country relate to possible loan quality risks after a period of high credit growth episodes, external shocks, and concentrated exposures because of broader interlinkages among large borrowers not covered by standard large exposure limits under the Basel framework. The IMF assessment highlights that macro-prudential policy response should be proactive if risks of, and from, high credit growth increase again. BSP should timely activate the CCyB if risks of broad-based rapid credit growth reemerge; develop targeted macro-prudential measures, such as loan-to-value and debt-to-income caps; and tighten the macro-prudential measures if high credit growth risks are more sector-specific―for example, in the real estate sector. 

     

    Related Links

    Keywords: Asia Pacific, Japan, Philippines, Banking, D-SIBs, FSAP, Article IV, Macro-Prudential Policy, CCyB, Systemic Risk, IMF

    Featured Experts
    Related Articles
    News

    EBA Analyzes Impact of Unwind Mechanism of Liquidity Coverage Ratio

    EBA published a report analyzing the impact of the unwind mechanism of the liquidity coverage ratio (LCR) for a sample of European banks over a three-year period, from the end of 2016 to the first quarter of 2020.

    November 19, 2020 WebPage Regulatory News
    News

    ECB Outlines Views on Possible Changes to AnaCredit Rule and TLTROs

    In response to questions from a member of the European Parliament, the ECB President Christine Lagarde issued a letter clarifying the possibility of amending the AnaCredit Regulation and making targeted longer-term refinancing operations (TLTROs) dependent on the climate-related impact of bank loans.

    November 19, 2020 WebPage Regulatory News
    News

    IASB Begins First Phase of Post-Implementation Review of IFRS 9

    IASB started the post-implementation review of the classification and measurement requirements in IFRS 9 on financial instruments and added the review as a project to its work plan.

    November 18, 2020 WebPage Regulatory News
    News

    FSB Report Examines Progress in Resolvability of Systemic Institutions

    FSB published a report that examines progress in implementing policy measures to enhance the resolvability of systemically important financial institutions.

    November 18, 2020 WebPage Regulatory News
    News

    EBA Benchmarks National Insolvency Frameworks Across EU

    EBA published a report on the benchmarking of national loan enforcement frameworks across 27 EU member states, in response to the call for advice from EC.

    November 18, 2020 WebPage Regulatory News
    News

    FSB Reports Assess Impact of Pandemic on Financial Stability

    FSB published a letter from its Chair Randal K. Quarles, along with two reports exploring various aspects of the market turmoil resulting from the COVID-19 event.

    November 17, 2020 WebPage Regulatory News
    News

    RBNZ Consults on Implementation of Capital Review Changes

    RBNZ launched a consultation on the details for implementing the final Capital Review decisions announced in December 2019.

    November 17, 2020 WebPage Regulatory News
    News

    IASB Announces Andreas Barckow as the New Chair from July 2021

    The Trustees of the IFRS Foundation, which are responsible for the governance and oversight of IASB, have announced the appointment of Dr. Andreas Barckow as the IASB Chair, effective July 2021.

    November 17, 2020 WebPage Regulatory News
    News

    HKMA Consults on Capital Rules for Bank Equity Investments in Funds

    HKMA issued a letter to consult the banking industry on a full set of proposed draft amendments to the Banking (Capital) Rules for implementing the Basel standard on capital requirements for banks’ equity investments in funds in Hong Kong.

    November 17, 2020 WebPage Regulatory News
    News

    ESRB Supports Extension of Macro-Prudential Measure by Swedish FSA

    ESRB published an opinion assessing the decision of Swedish Financial Supervisory Authority (FSA) to extend the application period of a stricter measure for residential mortgage lending, in accordance with Article 458 of the Capital Requirements Regulation (CRR).

    November 17, 2020 WebPage Regulatory News
    RESULTS 1 - 10 OF 6153