Featured Product

    BCBS Meets to Advance Supervisory Initiatives and Basel Implementation

    February 27, 2020

    BCBS met in Basel on February 26-27, 2020 to review risks impacting the banking system, advance a range of supervisory initiatives, and promote the implementation of Basel III. In the meeting, members discussed vulnerabilities associated with leveraged loans and collateralized loan obligations, in addition to the work plan and future deliverables of the high-level Task Force on climate-related financial risk. BCBS also published a newsletter outlining the regulatory and supervisory implications related to benchmark rate reforms.

    The BCBS newsletter on the benchmark rate reforms clarifies that, under the Basel Framework, amendments to capital instruments pursued solely for implementing benchmark rate reforms will not result in them being treated as new instruments for the purpose of assessing the minimum maturity and call date requirements or affect their eligibility for transitional arrangements of Basel III. BCBS will continue to monitor and assess issues related to benchmark reforms. During the course of this year, banks should expect greater supervisory scrutiny of their preparations and contingency planning. Based on its analysis, BCBS will consider what additional steps may be necessary to ensure a smooth and timely transition to the alternative reference rates, including issuing any further clarifications that may be necessary.

    At the meeting, the members discussed progress made by banks in preparing for the transition from the London interbank offered rate (LIBOR) to alternative reference rates. In December 2019, BCBS and FSB launched a survey on exposures to LIBOR and the associated supervisory measures. The survey results and a report on remaining challenges to benchmark transition will be provided to G20 finance ministers and Central Bank governors in July. Additionally, BCBS reviewed the implementation status of Basel III across its member jurisdictions and discussed progress on a strategic review initiated last year. BCBS has consulted with members and stakeholders on its future priorities, its structure, and its processes. Members also discussed the feedback received and exchanged initial views on the way forward. BCBS aims to finalize its review in the course of the year. Other key highlights of the meeting are as follows: 

    • BCBS discussed the work plan and future deliverables of high-level Task Force on climate-related financial risk. The future deliverables of the taskforce include the development of effective supervisory practices to mitigate climate-related financial risks, along with a set of analytical reports on climate-related financial risks, including a literature review, and reports on the transmission channels of such risks to the banking system and on measurement methodologies.
    • BCBS also took stock of members' current initiatives in this area and plans to publish a summary of this stocktake in March. 
    • As part of its ongoing Regulatory Consistency Assessment Program, BCBS approved the reports assessing the implementation of the Net Stable Funding Ratio, or NSFR, and Large Exposures standards in Hong Kong SAR, Indonesia, and Singapore. These reports will be published next month.
    • BCBS agreed to publish, in March, a consultation paper on strengthening the operational resilience of banks and will publish, in due course, a report on member experience in using the countercyclical capital buffer. 
    • BCBS discussed the financial stability implications of the coronavirus outbreak for the banking system and exchanged information on the business continuity measures that banks and authorities have put in place. BCBS encourages banks and supervisors to remain vigilant in light of the evolving situation and notes the importance of effective cross-border information-sharing and cooperation when dealing with such shocks.

     

    Related Links

    Keywords: International, Banking, Basel III, Climate Change Risk, ESG, Collateralized Loan Obligations, Benchmark Reforms, LIOR, RCAP, NSFR, Operational Risk, BCBS

    Featured Experts
    Related Articles
    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

    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

    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
    News

    EU to Amend Credit Risk Adjustment Rules; ESAs Submit Queries on SFDR

    The European Council published a draft Commission Delegated Regulation to amend the regulatory technical standards on specification of the calculation of specific and general credit risk adjustments.

    May 13, 2022 WebPage Regulatory News
    News

    EU Confirms Agreement on Rules on Cybersecurity and Banking Resolution

    The European Securities and Markets Authority (ESMA) published a paper that examines the systemic risk posed by increasing use of cloud services, along with the potential policy options to mitigate this risk.

    May 12, 2022 WebPage Regulatory News
    News

    MAS Amends Notice 635 and Issues Second Proposal on Green Taxonomy

    The Monetary Authority of Singapore (MAS) published amendments to Notice 635, which sets out requirements that a bank in Singapore has to comply with when granting an unsecured non-card credit facility to individuals.

    May 12, 2022 WebPage Regulatory News
    News

    EC Consults on PSD2 and Open Finance; EU Reaches Agreement on DORA

    The European Commission (EC) published a public consultation on the review of revised payment services directive (PSD2) and open finance.

    May 11, 2022 WebPage Regulatory News
    RESULTS 1 - 10 OF 8201