Featured Product

    GHOS Endorses Coordinated Approach to Mitigate COVID Risks for Banks

    November 30, 2020

    The Group of Central Bank Governors and Heads of Supervision (GHOS), the oversight body of BCBS, endorsed a coordinated approach to mitigate COVID-19 risks to the global banking system. The GHOS members agreed to mark, with the present agreement on the Basel III framework, a clear end to the post-crisis Basel III policy agenda. Any further potential adjustments to Basel III will be limited in nature and consistent with the evaluation work of BCBS. Going forward, the Basel III-related work of BCBS will focus on monitoring the implementation, timeliness, and consistency of Basel standards through the Regulatory Consistency Assessment Program as well as completing an evidence-based evaluation of the effectiveness of these reforms, also taking into consideration the lessons learned from the COVID-19 crisis.

    The GHOS also endorsed a series of recommendations from the Basel Committee to focus its policy and supervisory agenda on future risks to the global banking system and its vulnerabilities. The recommendations followed a strategic review conducted by the Committee over the past year. The future work of the Basel Committee will focus on new and emerging topics, including structural trends in the banking sector, the ongoing digitalization of finance, and climate-related financial risk. Against the backdrop of the evolving risks and vulnerabilities in light of the ongoing COVID-19 crisis, GHOS members tasked the Basel Committee with continuing to pursue a coordinated approach in responding to the crisis, to preserve a global level playing field, and to avoid regulatory fragmentation. The approach comprises the following elements:

    • Ongoing monitoring and assessment of vulnerabilities and risks to the global banking system from COVID-19, along with information-sharing of supervisory insights during the crisis
    • Encouraging the use of flexibility embedded in the Basel framework, where relevant
    • Monitoring the implementation of temporary adjustments to mitigate current risks to the banking system, to ensure they are consistent with the objectives of the Basel framework and are unwound in a timely manner
    • Adopting additional global measures in a coordinated manner, where necessary and prudent

    The oversight body of BCBS noted that using capital and liquidity resources to help banks to absorb shock during the ongoing COVID-19 crisis "should take priority at present." GHOS members strongly support the repeated guidance from the Basel Committee that a measured drawdown of these buffers is appropriate in the current period of stress and until the COVID-19 crisis is over. After the crisis, supervisors will provide banks with sufficient time to rebuild their buffers, taking account of economic, market, and bank-specific conditions.

     

    Related Link: Press Release

     

    Keywords: International, Banking, COVID-19, GHOS, RCAP, Basel, Regulatory Framework, Liquidity Risk, Climate Change Risk, Regtech, BCBS

    Featured Experts
    Related Articles
    News

    OSFI Issues Results of Pilot on Climate Risk Scenario Analysis

    The Office of the Superintendent of Financial Institutions (OSFI) published an update on the discussion paper that intended to engage federally regulated financial institutions and other interested stakeholders in a dialog with OSFI, to proactively enhance and align assurance expectations over key regulatory returns.

    January 20, 2022 WebPage Regulatory News
    News

    EC Issues Regulation on Adjustments to K-Factor Coefficients Under IFR

    The European Commission (EC) published a report summarizing responses to the targeted consultation on the supervisory convergence and the single rulebook in the European Union (EU).

    January 20, 2022 WebPage Regulatory News
    News

    ECB Issues Opinions on Green Bonds Standard and CRR Proposals

    The European Central Bank (ECB) published its opinion on a proposal for a regulation on European green bonds, following a request from the European Parliament.

    January 19, 2022 WebPage Regulatory News
    News

    ESRB Explores Policy Response to Risks Arising from Digitalization

    The Advisory Scientific Committee (ASC) of the European Systemic Risk Board (ESRB) published a report that explores the expected impact of digitalization on provision of financial and banking services, and proposes policy measures to address the risks stemming from digitalization.

    January 18, 2022 WebPage Regulatory News
    News

    HKMA Consults on FIRO Code, Revises Policy on Foreign Exchange Risk

    The Hong Kong Monetary Authority (HKMA) is consulting on the draft Financial Institutions (Resolution) Ordinance (Cap. 628), or FIRO, Code of Practice chapter on liquidity and funding in resolution, until March 14, 2022.

    January 18, 2022 WebPage Regulatory News
    News

    FI Publishes Multiple Regulatory and Reporting Updates

    The Swedish Financial Supervisory Authority (FI) announced that the capital adequacy reporting as at December 31, 2021 must be done by February 11, 2022.

    January 17, 2022 WebPage Regulatory News
    News

    EU Authorities Address COVID-19 Reporting, MCD, and PSD2 Issues

    The European Banking Authority (EBA) announced that the guidelines on the reporting and disclosure of exposures subject to measures COVID-relief measures shall continue to apply until further notice.

    January 17, 2022 WebPage Regulatory News
    News

    BSP Tackles Aspects of Lending and Islamic, Open & Sustainable Finance

    The Central Bank of the Philippines (BSP) issued communications covering developments related to online lending platforms, open finance framework and roadmap, and on the expected regulations in the area sustainable finance.

    January 16, 2022 WebPage Regulatory News
    News

    US Agencies Issue Regulatory Updates, FDIC Launches Tech Sprint

    The Board of Governors of the Federal Reserve System (FED) published the final rule that amends Regulation I to reduce the quarterly reporting burden for member banks by automating the application process for adjusting their subscriptions to the Federal Reserve Bank capital stock, except in the context of mergers.

    January 13, 2022 WebPage Regulatory News
    News

    EBA Issues Guide on Bank Resolvability, Consults on Transferability

    The European Banking Authority (EBA) published its assessment of risks through the quarterly Risk Dashboard and the results of the Autumn edition of the Risk Assessment Questionnaire (RAQ).

    January 13, 2022 WebPage Regulatory News
    RESULTS 1 - 10 OF 7903