BCBS Issues Sixteenth Progress Report on Adoption of Basel Framework
BCBS published the sixteenth progress report on adoption of the Basel regulatory framework. The report sets out the adoption status of Basel III standards for each member jurisdiction as of the end of March 2019. This includes the Basel III post-crisis reforms published by BCBS in December 2017 and the finalized market risk framework published in January 2019. These reforms will take effect from January 01, 2022.
As of the end of March 2019, all 27 member jurisdictions have risk-based capital rules, liquidity coverage ratio (LCR) regulations, and capital conservation buffers in force. Twenty-six member jurisdictions also have final rules in force for the countercyclical capital buffer and the domestic systemically important bank (D-SIB) requirement. Since publishing of the last report in October 2018, member jurisdictions have made further progress in implementing standards for which the deadline has already passed. These include notably the revised securitization framework and the leverage ratio based on the existing (2014) exposure definition. Other key highlights on the adoption of Basel III standards are as follows:
- Nineteen member jurisdictions have issued draft or final rules for the requirements for total loss-absorbing capacity (TLAC) holdings.
- Twenty-four member jurisdictions have issued draft or final rules for the large exposure framework, with only eight jurisdictions having the final rules in force for this standard, which took effect in January 2019.
- Twenty-three member jurisdictions have issued draft or final rules for the standard on interest rate risk in the banking book (IRRBB).
- Twenty-one member jurisdictions have issued final rules for the revised securitization framework.
- For the net stable funding ratio (NSFR), the final rules are in force in only 11 member jurisdictions, although this standard took effect on January 01, 2018.
- Limited progress has been observed in the effective implementation of capital requirements for equity investments in funds, standardized approach for counterparty credit risk (SA-CCR), and capital for central counterparties.
BCBS welcomes the overall progress made on the implementation of standards by member jurisdictions; however, it urges the members to strive for full, timely, and consistent implementation of Basel III post-crisis reforms and will continue monitoring closely the implementation of these reforms. BCBS will continue to closely monitor the implementation of Basel standards, including the finalized Basel III reforms.
Related Links
Keywords: International, Banking, Basel III, Progress Report, RCAP, Regulatory Framework, BCBS
Featured Experts
María Cañamero
Skilled market researcher; growth strategist; successful go-to-market campaign developer
Pierre-Etienne Chabanel
Brings expertise in technology and software solutions around banking regulation, whether deployed on-premises or in the cloud.
Nicolas Degruson
Works with financial institutions, regulatory experts, business analysts, product managers, and software engineers to drive regulatory solutions across the globe.
Related Articles
EU Amends CRD4 and CRD5 as Part of Capital Markets Recovery Package
EU published Directive 2021/338, which amends the Markets in Financial Instruments Directive (MiFID) II and the Capital Requirements Directives (CRD 4 and 5) to facilitate recovery from the COVID-19 crisis.
EU Committee Recommends Systemic Risk Buffer of 4.5% in Norway
The Standing Committee of the European Free Trade Association (EFTA) recommended that a systemic risk buffer level of 4.5% for domestic exposures can be considered appropriate for addressing the identified systemic risks to the stability of the financial system in Norway.
PRA Clarifies Approach to Onshoring of Credit Risk Rules for UK Banks
In a recent statement, PRA clarified its approach to the application of certain EU regulatory technical standards and EBA guidelines on standardized and internal ratings-based approaches to credit risk, following the end of the Brexit transition.
FSB Sets Out Work Priorities for 2021
In a recently published letter addressed to the G20 finance ministers and central bank governors, the FSB Chair Randal K. Quarles has set out the key FSB priorities for 2021.
EU Publishes Corrigendum to Revised Capital Requirements Regulation
EU published, in the Official Journal of the European Union, a corrigendum to the revised Capital Requirements Regulation (CRR2 or Regulation 2019/876).
ESAs Issue Statement on Application of Sustainability Disclosures Rule
ESAs published a joint supervisory statement on the effective and consistent application and on national supervision of the regulation on sustainability-related disclosures in the financial services sector (SFDR).
EC Consults on Crisis Management and Deposit Insurance Frameworks
EC published a public consultation on the review of crisis management and deposit insurance frameworks in EU.
HKMA Enhances Loan Guarantee Scheme to Alleviate Pressure on SMEs
HKMA announced that enhancements will be made to the Special 100% Loan Guarantee of the SME Financing Guarantee Scheme (SFGS) and the application period will be extended to December 31, 2021.
EBA Proposes Standards for Supervisory Cooperation Under IFD
EBA launched consultations on the regulatory and implementing technical standards on cooperation and information exchange between competent authorities involved in prudential supervision of investment firms.
BoE Addresses Banks in Scope of First Resolvability Assessment
BoE issued a letter to the CEOs of eight major UK banks that are in scope of the first Resolvability Assessment Framework (RAF) reporting and disclosure cycle.
