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

    EBA Publishes Phase 2 of Technical Package on Reporting Framework 2.10

    EBA published phase 2 of the technical package on the reporting framework 2.10, providing the technical tools and specifications for implementation of EBA reporting requirements.

    July 10, 2020 WebPage Regulatory News
    News

    FASB Proposes to Delay Implementation of Insurance Contracts Standard

    FASB issued a proposed Accounting Standards Update that would grant insurance companies, adversely affected by the COVID-19 pandemic, an additional year to implement the Accounting Standards Update No. 2018-12 on targeted improvements to accounting for long-duration insurance contracts, or LDTI (Topic 944).

    July 09, 2020 WebPage Regulatory News
    News

    APRA Updates Regulatory Approach to Loan Deferrals Amid COVID Crisis

    APRA updated the regulatory approach for loans subject to repayment deferrals amid the COVID-19 crisis.

    July 09, 2020 WebPage Regulatory News
    News

    BCBS and FSB Set Out Recommendations for Benchmark Transition

    BCBS and FSB published a report on supervisory issues associated with benchmark transition.

    July 09, 2020 WebPage Regulatory News
    News

    IAIS Sets Out Recommendations for Benchmark Transition for Insurers

    IAIS published a report on supervisory issues associated with benchmark transition from an insurance perspective.

    July 09, 2020 WebPage Regulatory News
    News

    ESMA Updates Reporting Manual on European Single Electronic Format

    ESMA updated the reporting manual on the European Single Electronic Format (ESEF).

    July 09, 2020 WebPage Regulatory News
    News

    EBA Calls on Resolution Authorities to Consider Impact of COVID Crisis

    EBA published a statement on resolution planning in light of the COVID-19 pandemic.

    July 09, 2020 WebPage Regulatory News
    News

    ECB Guideline on Materiality Threshold for Credit Obligations Past Due

    ECB published a guideline (2020/97), in the Official Journal of European Union, on the definition of materiality threshold for credit obligations past due for less significant institutions.

    July 08, 2020 WebPage Regulatory News
    News

    FED Temporarily Revises FR Y-14 With Respect to PPP and CARES Act

    FED temporarily revised the capital assessments and stress testing reports (FR Y-14A/Q/M) to implement the changes in response to the COVID-19 pandemic.

    July 08, 2020 WebPage Regulatory News
    News

    BCBS Finalizes Revisions to Credit Valuation Adjustment Risk Framework

    BCBS Finalizes Revisions to Credit Valuation Adjustment Risk Framework

    July 08, 2020 WebPage Regulatory News
    RESULTS 1 - 10 OF 5458