Featured Product

    IFSB Consults on Revised Capital Adequacy Standard for Islamic Banks

    November 04, 2019

    IFSB published an exposure draft on the revised capital adequacy standard for institutions offering Islamic banking services. The aim of exposure draft is to align the IFSB capital adequacy standard (IFSB-15) with global capital standards, particularly the Basel III final reforms. The comment period for the exposure draft ends on January 02, 2020. IFSB invites comments from central banks, regulatory and supervisory authorities, international organizations, institutions offering Islamic financial services, academics, and other interested parties. The enhancements to credit, market, and operational risk frameworks, as well as the leverage ratio framework, should be implemented by January 01, 2022.

    The enhancements to the components of capital, capital conservation buffer (CCB), countercyclical capital buffers (CCyB), and Islamic windows operations are expected to be implemented immediately by the regulatory and supervisory authorities in their jurisdictions. Regulatory and supervisory authorities may consider earlier implementation timelines wherever feasible, taking into account an adequate period for the transposition of the standard into national supervisory regulations and guidelines for institutions offering Islamic financial services. The revised standard provides enhanced guidance to the regulatory and supervisory authorities, along with the necessary flexibility for its application across regions, and to the small to fairly large and sophisticated institutions offering Islamic financial services. The main objectives of the standard include the following:

    • Assist the institutions offering Islamic financial services and their supervisory authorities in the implementation of a capital adequacy framework that will ensure effective coverage of risk exposures of the institutions and allocation of appropriate capital to cover these risks, thus enhancing the resilience of the the Islamic financial services industry
    • Provide enhanced guidance on the maintenance of high-quality regulatory capital components by the institutions offering Islamic financial services, which comply with Sharī`ah rules and principles
    • Enhance the guidance provided by the earlier IFSB capital adequacy standards in addressing the capital adequacy requirements of various risk exposures related to Sharī`ah-compliant products and services offered by the institutions offering Islamic financial services
    • Provide enhanced guidance on the capital adequacy treatment of an institution's involvement in Sukūk issuance and securitization processes in various capacities
    • Address specific concerns in the course of implementation of the earlier IFSB capital adequacy standards and guidance notes
    • Adapt international best practices, as well as current and emerging standards, relating to the capital adequacy for the institutions offering Islamic financial services

     

    Related Links

    Comment Due Date: January 02, 2020

    Keywords: International, Banking, Capital Adequacy, Basel III, Islamic Banking, Securitization, IFSB 15, IFSB

    Featured Experts
    Related Articles
    News

    PRA Proposes Changes to Consolidated Prudential Rules Under CRD5/CRR2

    PRA proposed rules (in CP12/21) for the application of existing consolidated prudential requirements to financial holding companies and mixed financial holding companies that have been approved or designated in accordance with Part 12B of the Financial Services and Markets Act 2000 (FSMA).

    June 21, 2021 WebPage Regulatory News
    News

    ECB Extends Leverage Ratio Relief for Banks Until March 2022

    ECB Banking Supervision announced that euro area banks it directly supervises may continue to exclude certain central bank exposures from the leverage ratio until March 2022.

    June 18, 2021 WebPage Regulatory News
    News

    OSFI Consults on Treatment of Credit Valuation Adjustments

    OSFI decided to increase the Domestic Stability Buffer from 1.00% to 2.50% of total risk-weighted assets, with effect from October 31, 2021.

    June 18, 2021 WebPage Regulatory News
    News

    HKMA Requires Banks to Submit Plans for Fintech Adoption

    HKMA is requesting banks to participate in a tech baseline assessment, which forms part of the HKMA Fintech 2025 strategy.

    June 18, 2021 WebPage Regulatory News
    News

    OSFI Consults on Operational Risk Capital Data Management Expectations

    OSFI published two documents to consult on the management of operational risk capital data for institutions required, or for those applying, to use the Basel III standardized approach for operational risk capital in Canada.

    June 18, 2021 WebPage Regulatory News
    News

    NGFS on Addressing Financial Stability Issues from Biodiversity Loss

    The NGFS Study Group on Biodiversity and Financial Stability published a Vision paper exploring the case for action in addressing the financial stability concerns arising from biodiversity loss.

    June 18, 2021 WebPage Regulatory News
    News

    ACPR Publishes CREDITIMMO Version 2.3.0 Taxonomy for Banks

    ACPR published the final version of CREDITIMMO 2.3.0 taxonomy for the decree of October 31, 2021.

    June 18, 2021 WebPage Regulatory News
    News

    EC Prolongs Italian Guarantee Scheme for Non-Performing Loans

    EC, has approved, under the EU State Aid rules, the fourth prolongation of the Italian guarantee scheme to facilitate the securitization of non-performing loans.

    June 18, 2021 WebPage Regulatory News
    News

    ECB Amends Guideline on Temporary Collateral Easing Measures

    ECB published Guideline 2021/975, which amends Guideline ECB/2014/31, on the additional temporary measures relating to Eurosystem refinancing operations and eligibility of collateral.

    June 17, 2021 WebPage Regulatory News
    News

    EIOPA Releases Report on Artificial Intelligence Governance Principles

    EIOPA published a report, from the Consultative Expert Group on Digital Ethics, that sets out artificial intelligence governance principles for an ethical and trustworthy artificial intelligence in the insurance sector in EU.

    June 17, 2021 WebPage Regulatory News
    RESULTS 1 - 10 OF 7128