BNM, the central bank of Malaysia, published a policy document that sets out the expectations and policy requirements on the development and maintenance of recovery plans for financial institutions. BNM also published the reporting templates for recover planning. Each financial institution will be required to identify and plan for the execution of a suite of recovery options to restore its long-term viability under a range of idiosyncratic and system-wide stress events. The information and assessment in recovery plans will serve as an important starting point for Perbadanan Insurans Deposit Malaysia (PIDM), which is the resolution authority of licensed banks and licensed Islamic banks, to improve the resolvability of member institutions and operationalize feasible and credible resolution plans. The policy document comes into effect on July 28, 2021.
BNM, in collaboration with PIDM, has established the policy framework to implement recovery and resolution planning for financial institutions in Malaysia, in line with the Financial Stability Board’s Key Attributes of Effective Resolution Regimes for Financial Institution. The recovery and resolution planning framework seeks to put in place an effective and efficient process to enhance supervision, recoverability, and resolvability of financial institutions, by incorporating essential elements of Key Attribute 11 of the Key Attributes into the domestic regulatory, supervisory, and resolution regimes. The recovery and resolution planning framework aims to:
- facilitate the preparation and maintenance of robust recovery plans by financial institutions that serve as a strategic planning tool that integrates with the risk appetite framework and reinforces risk management functions and strengthens incentives to establish private-sector arrangements to recover from a wide range of stress events.
- enhance capacity and preparedness of supervisory authorities to facilitate ex ante changes to financial institutions’ business structure and operations, support smooth execution of recovery plans, inform calibration of timely intervention and resolution actions to address viability threats, and support effective supervisory cooperation and crisis management arrangements with host and home authorities.
- strengthen capacity and preparedness of resolution authorities to improve resolvability of financial institutions and operationalize feasible and credible resolution plans that preserve continuity of critical functions, promote resolution strategies that minimize risks of loss, and provide for procedural/legal clarity to ensure orderly resolution in home and host jurisdictions.
Effective Date: July 28, 2021
Keywords: Asia Pacific, Malaysia, Banking, Resolution Framework, Recovery and Resolution Planning, Reporting, Islamic Banks, BNM
Previous ArticleIFSB Consults on Technical Note on Recovery and Resolution Framework
The European Banking Authority (EBA) published the final draft regulatory technical standards specifying and, where relevant, calibrating the minimum performance-related triggers for simple.
The European Central Bank (ECB) is undertaking the integrated reporting framework (IReF) project to integrate statistical requirements for banks into a standardized reporting framework that would be applicable across the euro area and adopted by authorities in other EU member states.
The European Banking Authority (EBA) has been awarded the top European Standard for its environmental performance under the European Eco-Management and Audit Scheme (EMAS).
The Monetary Authority of Singapore (MAS) set out the Financial Services Industry Transformation Map 2025 and, in collaboration with the SGX Group, launched ESGenome.
The Basel Committee on Banking Supervision met, shortly after a gathering of the Group of Central Bank Governors and Heads of Supervision (GHOS), the oversight body of BCBS.
The International Organization of Securities Commissions (IOSCO) welcomed the work of the international audit and assurance standard setters—the International Auditing and Assurance Standards Board (IAASB)
The Bank of England (BoE) published a Statistical Notice (2022/18), which informs that due to the Bank Holiday granted for Her Majesty Queen Elizabeth II’s State Funeral on Monday September 19, 2022.
The French Prudential Control and Resolution Authority (ACPR) announced that the European Banking Authority (EBA) has updated its filing rules and the implementation dates for certain modules of the EBA reporting framework 3.2.
The European Central Bank (ECB) published a paper that examines how credit rating agencies accepted by the Eurosystem, as part of the Eurosystem Credit Assessment Framework (ECAF)
The Australian Prudential Regulation Authority (APRA) announced reduction in the aggregate Committed Liquidity Facility (CLF) for authorized deposit-taking entities to ~USD 33 billion on September 01, 2022.