BCBS Advances Work on Climate Risk, Cryptoassets, and G-SIB Assessment
The Basel Committee on Banking Supervision (BCBS) announced updates on its work in the areas of climate-related financial risks, cryptoassets, the assessment methodology for global systemically important banks (G-SIBs), and the final Pillar 3 disclosure standards for banks. This announcement follows discussions during the Committee's October and November 2021 meetings, which also had on the agenda the risks and vulnerabilities to the global banking system, in addition to the policy and supervisory initiatives. Later this month, BCBS plans to consult on a set of principles for the effective management and supervision of climate-related financial risks at the internationally active banks.
The following are the other key BCBS announcements:
- Post a review of the comments received on the initial consultation on the prudential treatment of cryptoasset exposures of banks, BCBS plans to further consult on this by mid-2022.
- After discussing the feedback to its earlier proposal for a technical amendment to the process for reviewing the G-SIB assessment methodology, BCBS agreed to proceed with the proposed approach to replacing the existing three-year review cycle of the methodology, with a process of ongoing monitoring and review to ensure that it remains appropriate over time. In the near term, BCBS will review the implications of developments related to the European Banking Union for the G-SIB methodology, including a targeted review of the treatment of cross-border exposures on the G-SIB methodology.
- BCBS approved the final standards for Pillar 3 disclosures for the revised market risk framework and for a set of voluntary disclosures for sovereign exposures of banks, with the final disclosure standards expected to be published in the coming weeks.
- BCBS discussed the impact of the prolonged low interest-rate environment and the evolving outlook on the profitability, business models, and risk-taking behavior of banks. A deep-dive thematic analysis took stock of the cyclical and structural drivers behind interest rate dynamics and bank responses, the degree of heterogeneity across banking systems, and the main supervisory challenges and risks. BCBS will continue to assess these issues.
- Members took stock of the operational resilience of banks, including the reliance on third- and fourth-party service providers. BCBS will continue to assess the supervisory and policy implications of third- and fourth-party and concentration risk, in coordination with other global standard-setting bodies and international forums.
Related Link: Press Release
Keywords: International, Banking, Securities, Climate Change Risk, Crypto Assets, G-SIB Assessment, ESG, G-SIB, Disclosure, Pillar 3, Market Risk, Basel, BCBS
Featured Experts

María Cañamero
Skilled market researcher; growth strategist; successful go-to-market campaign developer

Nicolas Degruson
Works with financial institutions, regulatory experts, business analysts, product managers, and software engineers to drive regulatory solutions across the globe.

Michael Denton, PhD, PE
Dr. Denton provides industry leadership in the quantification of sustainability issues, climate risk, trade credit and emerging lending risks. His deep foundations in market and credit risk provide critical perspectives on how climate/sustainability risks can be measured, communicated and used to drive commercial opportunities, policy, strategy, and compliance. He supports corporate clients and financial institutions in leveraging Moody’s tools and capabilities to improve decision-making and compliance capabilities, with particular focus on the energy, agriculture and physical commodities industries.
Previous Article
OSFI Updates Manual of Reporting Forms and InstructionsRelated Articles
EC Consults on PSD2 and Open Finance; EU Reaches Agreement on DORA
The European Commission (EC) published a public consultation on the review of revised payment services directive (PSD2) and open finance.
EC Mandates ESAs to Propose Amendments to SFDR Technical Standards
The European Commission (EC) has issued two letters mandating the European Supervisory Authorities (ESAs) to jointly propose amendments to the regulatory technical standards under Sustainable Finance Disclosure Regulation or SFDR.
EBA Examines Supervisory Practices, Issues Deposits Reporting Template
The European Banking Authority (EBA) published its annual report on convergence of supervisory practices for 2021. Additionally, following a request from the European Commission (EC),
US Agency Publications Address Basel, Reporting, and CECL Developments
The Farm Credit Administration published, in the Federal Register, the final rule on implementation of the Current Expected Credit Losses (CECL) methodology for allowances
SEC Extends Comment Period on Climate Risk Disclosures
The U.S. Securities and Exchange Commission (SEC) looks set to intensify focus on crypto-assets and cyber risk and extended the comment period on the proposed rules to enhance and standardize climate-related disclosures for investors.
APRA Reduces Committed Liquidity Facility, Issues Other Updates
The Australian Prudential Regulation Authority (APRA) announced reduction in the aggregate Committed Liquidity Facility and issued an update on the operational preparedness for zero and negative market interest rates.
CMF Consults on Basel Rules, Presents Roadmap to Address Climate Risks
The Commission for the Financial Market (CMF) in Chile published capital adequacy ratios (as of February 2022, January 2022, and December 2021) for 17 banks and for the banking system.
PRA Issues Statement on NPEs and Policy on Trading Activity Wind-Down
The Prudential Regulation Authority (PRA) issued a statement on the European Banking Authority (EBA) guidelines on management of non-performing exposures (NPEs) and forborne exposures.
EBA Updates Standards for 2023 Benchmarking of Internal Approaches
The European Banking Authority (EBA) updated the implementing technical standards that specify the data collection for the 2023 supervisory benchmarking exercise in relation to the internal approaches used in market risk, credit risk, and IFRS 9 accounting.
EIOPA Responds to Stakeholder Views on Blockchain in Insurance
The European Insurance and Occupational Pensions Authority (EIOPA) published a feedback statement on the responses received to the consultation on blockchain and smart contracts in insurance.