BCB Issues Rules on Open Banking and Climate Risk Disclosures
The Central Bank of Brazil (BCB) published the Resolution No. 138 that sets out the scope of data and services for Phase 4 of open banking. The fourth stage, which covers data on exchange, accreditation, investment, insurance, and pensions, is scheduled to start on December 15, 2021. Participating institutions must make public the information about their products and services that are related to the disclosed scope. This Resolution entered into force on the date of its publication. Additionally, BCB published a set of regulations related to social, environmental, and climate-related risks and disclosures, following public consultations 82/2021, 85/2021, and 86/2021. BCB also published the first edition of a report on social, environmental, and climate-related risks and opportunities. The report provides an integrated view of the BCB actions implemented within the scope of the “BC# Agenda” on sustainability dimension.
BCB published the following on social, environmental, and climate-related risks and disclosures:
- CMN Resolution No. 4,943, which amends Resolution No. 4,557 and improves the rules for managing social, environmental, and climate risks applicable to institutions of the National Financial System—classified in Segments 1 (S1), 2 (S2), 3 (S3), and 4 (S4), pursuant to the regulations in force. This Resolution No. 4,943 shall enter into force on July 01, 2022.
- CMN Resolution No. 4,944, which amends Resolution No. 4,606 and improves the rules for managing social, environmental, and climate risks applicable to institutions of the National Financial System—classified in Segment 5 (S5). This Resolution No. 4,944 shall enter into force on December 01, 2022.
- CMN Resolution No. 4,945, which establishes new rules on the Social, Environmental, and Climate Responsibility Policy (PRSAC) and on actions for its effective implementation by the institutions of the National Financial System. The provisions will be in force on July 01, 2022 for institutions classified under S1 and S2 and on December 01, 2022 for institutions classified under S3, S4, and S5.
- BCB Resolution No. 139, which establishes requirements for disclosure of information in the report on social, environmental, and climate-related risks and opportunities (GRSAC report) by the institutions classified in S1, S2, S3, and S4, regarding information on the subject. The disclosure requirements will have a second phase of regulatory improvement, scheduled for 2022, which will address quantitative aspects like metrics and targets. This Resolution shall enter into force on December 01, 2022.
- Normative Instruction No. 153, which establishes the standardized tables for the dissemination of the report on social, environmental, and climate-related risks and opportunities (GRSAC report). This Normative Instruction shall enter into force on December 01, 2022.
- BCB Resolution No. 140, which provides for the creation of Section 9 on social, environmental, and climatic impediments, in Chapter 2 on basic conditions in the Rural Credit Manual (MCR). This Resolution enters into force on October 01, 2021.
S1 comprises universal banks, commercial banks, investment banks, foreign-exchange banks, and federal savings banks that have either the size of equal to or greater than 10% of the Gross Domestic Product (GDP) of Brazil, or the relevant international activity, regardless of the size of the institution. S2 comprises universal banks, commercial banks, investment banks, foreign-exchange banks, and federal savings banks whose size is less than 10% and equal to or greater than 1% of GDP as well as other types of institutions whose size is equal to or greater than 1% of GDP. S3 comprises institutions whose size is less than 1% and equal to or greater than 0.1% of GDP. S4 comprises institutions whose size is less than 0.1% of GDP. S5 includes institutions whose size is less than 0.1% of GDP and that use an optional simplified methodology to calculate the minimum requirements of regulatory capital, tier 1 capital, and core capital, except for multiple banks, commercial banks, investment banks, foreign-exchange banks, and federal savings banks.
Related Links (in Portuguese)
- Notice on Open Banking
- Press Release on Open Banking
- Resolution No. 138
- Notice on Climate Risk Rules
- Press Release on Climate Risk Rules
Effective Dates: October 01, 2021; July 01, 2022; December 01, 2022; Publication Date for Resolution on Open Banking
Keywords: Americas, Brazil, Banking, Open Banking, Fintech, Regtech, ESG, Climate Change Risk, Sustainable Finance, Disclosures, Reporting, BCB
Previous Article
ACPR Publishes Corrective Version of RUBA TaxonomyRelated Articles
PRA and FPC Finalize Changes to Leverage Ratio Framework in UK
The Prudential Regulation Authority (PRA) published the final policy statement PS21/21 on the leverage ratio framework in the UK. PS21/21, which sets out the final policy of both the Financial Policy Committee (FPC) and PRA
CFPB Proposes Rule on Small Business Lending Data Collection
The Consumer Financial Protection Bureau (CFPB) proposed to amend Regulation B to implement changes to the Equal Credit Opportunity Act (ECOA) under Section 1071 of the Dodd-Frank Act.
PRA Decides to Maintain O-SII Buffers for Another Year
The Prudential Regulation Authority (PRA) decided to maintain, at the 2019 levels, the buffer rates for the Other Systemically Important Institutions (O-SII) for another year, with no new rates to be set until December 2023.
FSB Report Assesses Implementation of Recommendations on Stablecoins
The Financial Stability Board (FSB) published a progress report on implementation of its high-level recommendations for the regulation, supervision, and oversight of global stablecoin arrangements.
APRA Updates Loan Serviceability Expectations for Home Lending
In a letter to the authorized deposit taking institutions, the Australian Prudential Regulation Authority (APRA) announced an increase in the minimum interest rate buffer it expects banks to use when assessing the serviceability of home loan applications.
CPMI and IOSCO Consult on Guidance on Stablecoin Arrangements
The Committee on Payments and Market Infrastructures (CPMI) and the International Organization of Securities Commissions (IOSCO) are consulting on the preliminary guidance that clarifies that stablecoin arrangements should observe international standards for payment, clearing, and settlement systems.
EBA and EIOPA Set Out Work Priorities for 2022
The European Banking Authority (EBA) and the European Insurance and Occupational Pensions Authority (EIOPA) have set out their respective work priorities for 2022.
MFSA Issues Reporting Updates and Guidance for Banks
The Malta Financial Services Authority (MFSA) updated the guidelines on supervisory reporting requirements under the reporting framework 3.0, in addition to the reporting module on leverage under the common reporting (COREP) framework.
EC Publishes Decision on List of Equivalent Third Countries Under CRR
The European Commission (EC) published the Implementing Decision 2021/1753 on the equivalence of supervisory and regulatory requirements of certain third countries and territories for the purposes of the treatment of exposures, in accordance with the Capital Requirements Regulation or CRR (575/2013).
EC Rule on Contractual Recognition of Write-Down and Conversion Powers
EC published the Implementing Regulation 2021/1751, which lays down implementing technical standards on uniform formats and templates for notification of determination of the impracticability of including contractual recognition of write-down and conversion powers.
