BCBS Publishes Summary of the Meeting in June 2019
BCBS published a summary of its June meeting in Basel. At the meeting, BCBS members discussed a range of policy and supervisory issues and took stock of the members' implementation of post-crisis reforms. This was the first Basel Committee meeting chaired by Pablo Hernández de Cos, Governor of the Bank of Spain, following his appointment by Governors and Heads of Supervision in March 2019. The Committee discussed matters related to financial technology and crypto-assets and its work program for evaluating the impact of its post-crisis reforms, with the Committee committing to publish additional information of this work in due course.
At the meeting, the Committee:
- Agreed on a targeted and limited revision of the leverage ratio to allow margin received from a client to offset the exposure amounts of client-cleared derivatives. This revision, which will be published next week, seeks to balance the robustness of the leverage ratio as a safeguard against unsustainable levels of leverage with the G20 Leaders' commitment to promote the central clearing of standardized derivative contracts. The Committee will monitor the effect of this revision on the leverage ratio framework.
- Agreed on a set of disclosure requirements to curb leverage ratio window dressing. The standard will be revised to require banks to disclose their leverage ratios based on the quarter-end and average values of securities financing transactions. These disclosure requirements will be published next week.
- Approved a report on Pillar 2 supervisory practices and approaches, which will be published shortly.
- Reviewed the reports that assessed the implementation of the Net Stable Funding Ratio and large exposures standards in Australia, Canada, and India. Publication of these reports is expected in July.
- Agreed to join Network for Greening the Financial System (NGFS) as an observer, post discussions on the implications of the first comprehensive NGFS report.
- Agreed to conduct further work on financial technology, including on the risk management challenges associated with the use of artificial intelligence and machine learning in financial services.
- Will continue to assess the risks from crypto-assets and the best ways to address them.
- will publish, in due course, a a report on the regulatory and supervisory implications of open banking and application programming interfaces.
Related Link: Press Release
Keywords: International, Banking, Fintech, Crypto-Assets, Pillar 2, Leverage Ratio, Disclosures, Large Exposures, Climate Change Risks, BCBS
Featured Experts
María Cañamero
Skilled market researcher; growth strategist; successful go-to-market campaign developer
Nicolas Degruson
Works with financial institutions, regulatory experts, business analysts, product managers, and software engineers to drive regulatory solutions across the globe.
Patrycja Oleksza
Applies proficiency and knowledge to regulatory capital and reporting analysis and coordinates business and product strategies in the banking technology area
Related Articles
APRA Finalizes Guidance on Management of Climate Change Risks
The Australian Prudential Regulation Authority (APRA) released the final Prudential Practice Guide on management of climate change financial risks (CPG 229) for banks, insurers, and superannuation trustees.
European Council Adopts Position on Digital Finance Package Proposals
The European Council adopted its position on two proposals that are part of the digital finance package adopted by the European Commission in September 2020, with one of the proposals involving the regulation on markets in crypto-assets (MiCA) and the other involving the Digital Operational Resilience Act (DORA).
PRA Proposes Rulebook Changes; BoE Extends BEEDS Testing Window
The Prudential Regulation Authority (PRA) is proposing, via the consultation paper CP21/21, to apply group provisions in the Operational Resilience Part of the PRA Rulebook (relevant for the Capital Requirements Regulation or CRR firms) to holding companies.
EC Proposes New Measures Under Capital Markets Union Package
The European Commission (EC) has adopted a package of measures related to the Capital Markets Union.
EBA Publishes Standards to Calculate Risk-Weights of CIUs Under CRR
The European Banking Authority (EBA) published the final report on draft regulatory technical standards for the calculation of risk-weighted exposure amounts of collective investment undertakings or CIUs, in line with the Capital Requirements Regulation (CRR).
FED Outlines Lending Conditions and Supervisory Activities in H1 2021
The Board of Governors of the Federal Reserve System (FED) published a report that summarizes banking conditions in the United States, along with the supervisory and regulatory activities of FED.
APRA Expects Boards to Strengthen Ability to Oversee Cyber Resilience
The Australian Prudential Regulation Authority (APRA) recently completed two pilot initiatives in its 2020-2024 Cyber Security Strategy, which was published in November 2020.
FSB Updates List of Global Systemically Important Banks
The Basel Committee on Banking Supervision (BCBS) published further information related to its 2021 assessment of global systemically important banks (G-SIBs), with additional details to help understand the scoring methodology.
FASB Proposes Improvements to Credit Losses Standard
The Financial Accounting Standards Board (FASB) is consulting on an Accounting Standards Update and the associated taxonomy improvements for requirements on troubled debt restructurings and vintage disclosures under the credit losses standard (for financial instruments) topic 326.
US Agencies Issue Statement on Crypto-Asset Policy Initiatives
US Agencies issued a statement that summarizes the work undertaken during the interagency policy sprints focused on crypto-assets and provides a roadmap of future work related to crypto-assets.
