General Information & Client Services
  • Americas: +1.212.553.1653
  • Asia: +852.3551.3077
  • China: +86.10.6319.6580
  • EMEA: +44.20.7772.5454
  • Japan: +81.3.5408.4100
Media Relations
  • New York: +1.212.553.0376
  • London: +44.20.7772.5456
  • Hong Kong: +852.3758.1350
  • Tokyo: +813.5408.4110
  • Sydney: +61.2.9270.8141
  • Mexico City: +001.888.779.5833
  • Buenos Aires: +0800.666.3506
  • São Paulo: +0800.891.2518
June 20, 2018

IMF published a report on the detailed assessment of observance of the implementation of the Basel Core Principles for Effective Banking Supervision (BCPs) in Romania, under its Financial Sector Assessment Program (FSAP). Out of the 29 principles, Romania was found to be compliant with 11, largely compliant with 15, and materially non-compliant with 3 BCPs. The material non-compliance was with respect to the principles on country and transfer risks; transactions with related parties; and independence, accountability, resourcing, and legal protection for supervisors.

As an EU member state, Romania is subject and aligned to the EU common regulatory framework for banking supervision. The adoption of the Capital Requirements Regulation and Directive IV (CRR/CRD IV), which forms the Single Rule Book, was an important step toward stronger prudential regulation. Prudential regulations of the National Bank of Romania (NBR) are broadly aligned to the requirements of BCPs. As of 2017, NBR has identified 11 banks as "systematically important," of which 8 are supervised at group level by the Single Supervisory Mechanism. Some of the key IMF recommendations are as follows:

  • Devote further supervisory attention to risk models, including advanced approach for regulatory capital calculation.
  • Conduct a thematic review on the large exposure limit across banks and review the suitability of EUR 150 million as an absolute limit.
  • Review and amend the regulation on affiliated party transactions in a more prudent manner.
  • Improve the prudential reporting template on related party transactions for more effective monitoring and issue a guidance note/instruction that lays down more concrete requirements for monitoring and managing related party transactions.
  • Perform a periodic review of whether the prudential returns (required outside of European reporting framework) satisfy supervisory needs.
  • Update current regulation based on EU-wide regulatory amendment process reflecting new standards for IRRBB, which were published in April 2016.
  • Include explicit requirements in the regulation that banks include appropriate scenarios into their stress testing programs to reflect country and transfer risk analysis.
  • Expand the scope and required items of reporting on operational risk events to keep the NBR apprised of developments affecting operational risk.
  • Consider the opportunity to require, at least for significant banks, more frequent disclosure (than on an annual basis).
  • Introduce a legal provision protecting the NBR as an institution against lawsuits for actions taken and/or omissions made while discharging its duties in good faith.

 

Related Link: Detailed Assessment of BCPs

Keywords: Europe, EU, Romania, Banking, FSAP, BCP, CRR/CRD, IMF

Related Insights
News

CBB Proposes and Finalizes Rulebook Modules for Banks in November 2018

CBB announced the issuance of new leverage ratio requirements under Module CA (Part 3) for Islamic (Chapter CA-10) and conventional bank licensees (Chapter CA-15).

November 15, 2018 WebPage Regulatory News
News

IAIS Publishes Drafts of Revised ICP 8, ICP 15, ICP 16, and ICP 20

IAIS published the drafts of revised Insurance Core Principles on Public Disclosure (ICP 20), Investments (ICP 15), Enterprise Risk Management for Solvency Purposes (ICP 16), and Risk Management and Internal Controls (ICP 8), along with a revised draft of the glossary on enterprise risk management (ERM).

November 14, 2018 WebPage Regulatory News
News

MAS Amends Notice 637 on Capital Adequacy Requirements in Singapore

MAS published the final, revised Notice 637 on the risk-based capital adequacy requirements in Singapore.

November 13, 2018 WebPage Regulatory News
News

ESMA Updates Q&A on Implementation of CSD Regulation and MAR

ESMA updated questions and answers (Q&A) documents on the implementation of the Central Securities Depository (CSD) Regulation and Market Abuse Regulation (MAR).

November 12, 2018 WebPage Regulatory News
News

FSB Finalizes and Publishes the Cyber Lexicon

FSB published a cyber lexicon, following the public consultation earlier this year.

November 12, 2018 WebPage Regulatory News
News

SRB Updates Liability Data Reporting Template for 2019

SRB published version 2.7.1 of the Liability Data Reporting (LDR) Template.

November 12, 2018 WebPage Regulatory News
News

ECB to Conduct Comprehensive Assessment of Six Bulgarian Banks

ECB will undertake a comprehensive assessment of six Bulgarian banks. The exercise, comprising an asset quality review and a stress test, follows Bulgaria’s submission of a request to establish close cooperation with ECB on July 18, 2018.

November 12, 2018 WebPage Regulatory News
News

IMF Publishes Reports on the 2018 Article IV Consultation with Chile

IMF published its staff report and selected issues report under the 2018 Article IV consultation with Chile.

November 09, 2018 WebPage Regulatory News
News

PRA Issues PS27/18 on Implementing the Extension of SM&CR to Insurers

PRA published the policy statement PS27/18, which provides feedback to responses to the consultation paper CP20/18, on implementing the extension of the Senior Managers and Certification Regime (SM&CR) to insurers (Part 2).

November 09, 2018 WebPage Regulatory News
News

EBA Single Rulebook Q&A: First Update for November 2018

EBA published answers to seven questions under the Single Rulebook question and answer (Q&A) updates for this week.

November 09, 2018 WebPage Regulatory News
RESULTS 1 - 10 OF 2205