Featured Product

    BIS General Manager on Importance of Finalizing Basel III Reforms

    June 25, 2017

    BIS presented its 87th annual report for 2016–17, on the occasion of its Annual General Meeting in Basel. Additionally, on this occasion, Jaime Caruana, the General Manager of BIS, elaborated on the role of international cooperation in supporting policies to strengthen resilience. He also added that finalizing the financial reforms (Basel III) under way is a priority.

    He offered his observations on how international cooperation can support policies to strengthen resilience. In many respects, building resilience is first and foremost a domestic task. However, certain challenges call for a global response and require international cooperation within a consistent multilateral framework. Managing the risks associated with financial openness is a prime example. The financial system is truly global. Many financial institutions are active around the globe, facilitating funding and managing financial risks across many jurisdictions. As the dominant global currency, the U.S. dollar is the currency of choice not only for around half of all trade, but also for roughly half of global cross-border bank claims and more than 60% of central banks’ foreign exchange assets. Efforts to build resilience globally have to take these features into account. Therefore, “Completing Basel III is especially important, given the role banks play in the global financial system. This is no time to weaken safeguards or add another source of uncertainty that would hinder the necessary adjustments in the financial industry.”

     

    The annual report, among other factors, reviews recent banking, insurance, and asset management sector developments and discusses how banks are adjusting their business models in response to the key financial sector trends, including the regulatory reforms that are about to be completed. It elaborates on changing US dollar funding patterns and their implications for bank business models and systemic risk. The annual report also discusses the challenges posed by the evolving fintech sector. In this context, the report highlights that “a pressing question for regulators is how to ensure prudent risk management.” Mounting concerns about cyber-security underscore the potential risks of technology-enhanced financial services. Due diligence of possibly multiple internal and external service providers may be needed to ensure the integrity of IT systems. Furthermore, competition between banks and fintech platforms may require approaches that maintain a cross-sectoral level playing field (same risk, same rules) to reduce regulatory arbitrage, while preserving incentives for technological innovation, such as via regulatory "sandboxes."

     

    Related Links

    BIS Annual Report

    Speech of Jaime Caruana (PDF)

    Keywords: International, BIS, Annual Report, Basel III, Regulatory Reforms, FinTech

    Featured Experts
    Related Articles
    News

    PRA Amends Pillar 2 Capital Framework for Banks

    PRA published the policy statement PS2/20 that contains the final amendments to the Pillar 2 framework and provides feedback to responses to the consultation paper CP5/19 on updates related to Pillar 2 capital framework.

    January 23, 2020 WebPage Regulatory News
    News

    FED Proposes to Revise Information Collection Under Market Risk Rule

    FED proposed to revise and extend, for three years, FR 4201, which is the information collection under the market risk capital rule.

    January 22, 2020 WebPage Regulatory News
    News

    MAS Amends Notices on Minimum Liquid Asset Requirements for Banks

    MAS published amendments to Notices 1015, 613, and 649 related to the minimum liquid assets (MLA) requirements.

    January 21, 2020 WebPage Regulatory News
    News

    APRA Publishes Submission on Fintech and Regtech

    APRA published its submission, to the Senate Select Committee, on financial technology and regulatory technology.

    January 21, 2020 WebPage Regulatory News
    News

    ECB Consults on Guideline on Threshold for Credit Obligations Past Due

    ECB published a draft guideline, along with the frequently asked questions (FAQs), on the definition of the materiality threshold for credit obligations past due for less significant institutions.

    January 20, 2020 WebPage Regulatory News
    News

    BIS Discusses Role of Central Banks in Addressing Climate Change Risks

    BIS published a book that reviews ways of addressing the climate change risks within the financial stability mandate of central banks.

    January 19, 2020 WebPage Regulatory News
    News

    FSB Report Examines Global Nonbank Financial Intermediation Activity

    FSB published the ninth annual report examining the global non-bank financial intermediation activity.

    January 19, 2020 WebPage Regulatory News
    News

    OSFI Publishes Instruction Guide on Solvency Information Return

    OSFI published an instruction guide to assist administrators of pension plans in completing the Solvency Information Return that is required to be filed with OSFI.

    January 17, 2020 WebPage Regulatory News
    News

    EU Amends IFRS 9 Rule, Changes Concern Interest Rate Benchmark Reforms

    EU published Regulation 2020/34 regarding the International Accounting Standard (IAS) 39 and International Financial Reporting Standards (IFRS) 7 and 9.

    January 16, 2020 WebPage Regulatory News
    News

    FDIC and OCC Issue Statement on Heightened Cyber Security Risk

    In response to the heightened cyber-security risk facing the financial services industry and other critical business sectors, FDIC and OCC issued an interagency statement on heightened cyber-security risk.

    January 16, 2020 WebPage Regulatory News
    RESULTS 1 - 10 OF 4515