HKMA Revised Capital and Liquidity Rules Under Banking Ordinance
The Banking (Capital) (Amendment) Rules 2017 (BCAR 2017), the Banking (Liquidity) (Amendment) Rules 2017 (BLAR 2017), and the Banking (Specification of Multilateral Development Bank) (Amendment) Notice 2017 (Amendment Notice 2017) were published in the Gazette to implement certain recent international standards on banking regulation in Hong Kong.
- BCAR 2017. The amendments contained in the BCAR 2017 are to implement three Basel III-related capital standards of BCBS. These include the revised securitization framework, the leverage ratio framework, and the interim capital treatment of expected loss provisions under Hong Kong Financial Reporting Standard (HKFRS) 9 (in line with the new International Financial Reporting Standard 9).
- BLAR 2017. BLAR 2017 aims to implement the Basel III net stable funding ratio and a new local Core Funding Ratio to different categories of authorized institutions, with regard to their business size and liquidity risk profile, to ensure that their assets are financed with a sufficiently stable source of funding.
- Amendment Notice 2017. The Amendment Notice seeks to implement the BCBS decision of November 2016 to allow banks to apply a 0% risk-weight to claims on the International Development Association (a member of the World Bank Group) as a multilateral development bank (MDB) under the standardized approach for credit risk. The opportunity is also taken to incorporate the Chinese names of certain MDBs in the existing Notice.
The three pieces of subsidiary legislation will be tabled before the Legislative Council for negative vetting on October 25, 2017. Subject to the views of the Legislative Council, the subsidiary legislation should come into operation on January 01, 2018. These rules seek mainly to implement the Basel III-related capital and liquidity standards that are scheduled to take effect from January 01, 2018, in accordance with the international timeline.
Keywords: Asia Pacific, Hong Kong, Banking, BCAR, BLAR, IFRS 9, Securitization Framework, HKMA
Previous Article
EBA Single Rulebook Q&A: Third Update for October 2017Related Insights
News
FSB Report Examines Financial Stability Implications of FintechFSB published a report that assesses fintech-related market developments and their potential implications for financial stability.
February 14, 2019
WebPage
Regulatory News
|
News
US Agencies Amend Regulatory Capital Rule to Allow Phase-In for CECLUS Agencies (FDIC, FED, and OCC) adopted the final rule to address changes to credit loss accounting under the U.S. generally accepted accounting principles; this includes banking organizations’ implementation of the current expected credit losses (CECL) methodology.
February 14, 2019
WebPage
Regulatory News
|
News
OCC Consults on Company-Run Stress Test Requirements for BanksOCC proposed amendments to its company-run stress testing requirements for national banks and Federal savings associations, consistent with section 401 of the Economic Growth, Regulatory Relief, and Consumer Protection (EGRRCP) Act.
February 12, 2019
WebPage
Regulatory News
|
News
CFTC Extends Comment Periods for Trade Execution Requirement ProposalsCFTC announced that it is extending comment period for the proposed amendments related to the regulations on swap execution facilities (SEF) and trade execution requirement.
February 12, 2019
WebPage
Regulatory News
|
News
OCC Proposes to Renew Information Collection Under Stress Test RuleOCC is proposing to renew its information collection titled “Annual Stress Test Rule” (OMB Control No: 1557-0311). Comments must be received on or before March 13, 2019.
February 11, 2019
WebPage
Regulatory News
|
News
OSFI Consults on NSFR Disclosure Requirements for D-SIBsOSFI proposed the draft guideline on the net stable funding ratio (NSFR) disclosure requirements for domestic systemically important banks (D-SIBs).
February 11, 2019
WebPage
Regulatory News
|
News
EC Amends Its Regulation to Clarify Impairment Requirements for IFRS 9EC published the EU Regulation 2019/237 that amends Regulation (EC) No 1126/2008 adopting certain international accounting standards, in accordance with Regulation (EC) No 1606/2002 regarding International Accounting Standard (IAS) 28 on Investments in Associates and Joint Ventures.
February 11, 2019
WebPage
Regulatory News
|
News
FSB Chair Randal Quarles Speaks About the Upcoming Work of FSBWhile speaking at the BIS Special Governors Meeting in Hong Kong, Randal K. Quarles, the Chair of FSB and Vice Chair of FED, discussed his views on how the work of FSB must evolve and the key principles that, he believes, should inform that work.
February 10, 2019
WebPage
Regulatory News
|
News
OSFI Proposes to Amend the Liquidity Adequacy Requirements for BanksOSFI proposed revisions to the Liquidity Adequacy Requirements (LAR) Guideline for banks. OSFI published the proposed drafts (with proposed changes highlighted in yellow) of Chapters 1,2, 4, and 5 of the LAR guideline.
February 08, 2019
WebPage
Regulatory News
|
News
HKMA Publishes FAQs on Local Implementation of IRRBB FrameworkHKMA published the frequently asked questions (FAQs) related to the local implementation of the interest rate risk in the banking book (IRRBB).
February 08, 2019
WebPage
Regulatory News
|