Featured Product

    APRA Issues FAQ on Capital Standard, Closes Westpac Investigation

    March 12, 2021

    APRA published a frequently asked question (FAQ) on its expectations for historical rate rollovers on non-foreign exchange contracts in the context of APS 180, which is the prudential standard on capital adequacy for counterparty credit risk exposures. Under paragraph 17 of APS 180, the historical rate rollovers are permitted only on foreign exchange contracts and not on non-foreign-exchange transactions. APRA is currently considering this position, including potentially some limited flexibility for authorized deposit taking institutions in certain circumstances to transact historical rate rollovers on non-foreign exchange contracts where APRA is comfortable with the oversight, limits, risk assessment, and controls. This could include cases where the underlying transaction has been delayed and there is a clear expectation of delivery in the short term. APRA will assess the transactions and consider an adjustment to APS 180 on a case-by-case basis, for individual institutions.

    In another development, APRA closed its investigation into the possible breaches of the Banking Act 1959, including Banking Executive Accountability Regime (BEAR), by Westpac Banking Corporation. However, Westpac remains subject to a court enforceable undertaking to implement an integrated risk governance remediation plan to uplift risk governance across its business, with ongoing independent review over its progress. The $1 billion operational risk capital add-on, which reflects the heightened operational risk profile of the bank, will also remain in place until Westpac completes remediation, under the court enforceable undertaking, to the satisfaction of APRA.

     

    Related Links

    Keywords: Asia Pacific, Australia, Banking, FAQ, BEAR, Westpac, Historical Rate Rollovers, APS 180, Regulatory Capital, Basel, Derivatives, APRA

    Featured Experts
    Related Articles
    News

    EBA Clarifies Use of COVID-19-Impacted Data for IRB Credit Risk Models

    The European Banking Authority (EBA) published four draft principles to support supervisory efforts in assessing the representativeness of COVID-19-impacted data for banks using the internal ratings based (IRB) credit risk models.

    June 21, 2022 WebPage Regulatory News
    News

    EP Reaches Agreement on Corporate Sustainability Reporting Directive

    The European Council and the European Parliament (EP) reached a provisional political agreement on the Corporate Sustainability Reporting Directive (CSRD).

    June 21, 2022 WebPage Regulatory News
    News

    PRA Consults on Model Risk Management Principles for Banks

    The Prudential Regulation Authority (PRA) launched a consultation (CP6/22) that sets out proposal for a new Supervisory Statement on expectations for management of model risk by banks.

    June 21, 2022 WebPage Regulatory News
    News

    EC Regulation Amends Standards for Calculating Credit Risk Adjustments

    The European Commission (EC) published the Delegated Regulation 2022/954, which amends regulatory technical standards on specification of the calculation of specific and general credit risk adjustments.

    June 21, 2022 WebPage Regulatory News
    News

    BIS Hub Updates Work Program for 2022, Announces New Projects

    The Bank for International Settlements (BIS) Innovation Hub updated its work program, announcing a set of projects across various centers.

    June 17, 2022 WebPage Regulatory News
    News

    EIOPA Issues Cyber Underwriting Proposal, Statement on Open Insurance

    The European Insurance and Occupational Pensions Authority (EIOPA) published two consultation papers—one on the supervisory statement on exclusions related to systemic events and the other on the supervisory statement on the management of non-affirmative cyber exposures.

    June 17, 2022 WebPage Regulatory News
    News

    US Senate Members Seek Details on SEC Proposed Climate Disclosure Rule

    Certain members of the U.S. Senate Committee on Banking, Housing, and Urban Affairs issued a letter to the Securities and Exchange Commission (SEC)

    June 16, 2022 WebPage Regulatory News
    News

    EIOPA Consults on Review of Securitization Framework in Solvency II

    The European Insurance and Occupational Pensions Authority (EIOPA) published a consultation paper on the advice on the review of the securitization prudential framework in Solvency II.

    June 16, 2022 WebPage Regulatory News
    News

    BIS Bulletins Discuss DeFi Lending and Aspects of Crypto-Assets

    The Bank for International Settlements (BIS) published bulletins on lending in decentralized finance (DeFi) system, on blockchain scalability and fragmentation of crypto, and on extractable value and market manipulation in crypto and decentralized finance.

    June 16, 2022 WebPage Regulatory News
    News

    UK Authorities Issue Regulatory and Reporting Updates for Banks

    The Prudential Regulation Authority (PRA) issued a statement on PRA buffer adjustment while the Bank of England (BoE) published a notice on the statistical reporting requirements for banks.

    June 15, 2022 WebPage Regulatory News
    RESULTS 1 - 10 OF 8292