HKMA Announces Publication of SA-CCR Rules in Gazette
HKMA announced that the Banking (Capital) (Amendment) Rules 2020 (BCAR 2020) have been published in the Hong Kong Gazette. The amendments contained in the BCAR 2020 are to implement the two BCBS-issued capital standards for treatment of banks' counterparty credit risk exposures to derivatives trades. These standards are for the standardized approach for measuring counterparty credit risk exposures (SA-CCR) and for the capital requirements for bank exposures to central counterparties. These standards form a part of the Basel III reform package.
These capital standards introduced a new method for measuring the amount of counterparty credit risk incurred by banks from derivative contracts and revised the capital treatment for bank exposures to central counterparties and clearing intermediaries. The BCAR 2020 will be tabled before the Legislative Council for negative vetting on April 29, 2020. Subject to the views of the Legislative Council, the subsidiary legislation should come into operation on June 30, 2021.
Effective Date: June 30, 2021
Keywords: Asia Pacific, Hong Kong, Banking, BCAR, Counterparty Credit Risk, Standardized Approach, Basel III, Derivatives, SA-CCR, Regulatory Capital, HKMA, 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.
Patrycja Oleksza
Applies proficiency and knowledge to regulatory capital and reporting analysis and coordinates business and product strategies in the banking technology area
Previous Article
PRA Outlines Next Steps for Stress Testing the Insurance SectorRelated Articles
ISSB Sustainability Standards Expected to Become Global Baseline
The finalization of the two sustainability disclosure standards—IFRS S1 and IFRS S2—is expected to be a significant step forward in the harmonization of sustainability disclosures worldwide.
IOSCO, BIS, and FSB to Intensify Focus on Decentralized Finance
Decentralized finance (DeFi) is expected to increase in prominence, finding traction in use cases such as lending, trading, and investing, without the intermediation of traditional financial institutions.
BCBS Assesses NSFR and Large Exposures Rules in US
The Basel Committee on Banking Supervision (BCBS) published reports that assessed the overall implementation of the net stable funding ratio (NSFR) and the large exposures rules in the U.S.
Global Agencies Focus on ESG Data, Climate Litigation and Nature Risks
At the global level, supervisory efforts are increasingly focused on addressing climate risks via better quality data and innovative use of technologies such as generative artificial intelligence (AI) and blockchain.
ISSB Standards Shine Spotlight on Comparability of ESG Disclosures
The finalization of the IFRS sustainability disclosure standards in late June 2023 has brought to the forefront the themes of the harmonization of sustainability disclosures
EBA Issues Several Regulatory and Reporting Updates for Banks
The European Banking Authority (EBA) recently issued several regulatory publications impacting the banking sector.
BCBS Proposes to Revise Core Principles for Banking Supervision
The Basel Committee on Banking Supervision (BCBS) launched a consultation on revisions to the core principles for effective banking supervision, with the comment period ending on October 06, 2023.
US Proposes Final Basel Rules, Transition Period to Start in July 2025
The U.S. banking agencies (FDIC, FED, and OCC) recently proposed rules implementing the final Basel III reforms, also known as the Basel III Endgame.
FSB Report Outlines Next Steps for Climate Risk Roadmap
The Financial Stability Board (FSB) recently published the second annual progress report on the July 2021 roadmap to address climate-related financial risks.
EBA Plans on Ad-hoc ESG Data Collection and Climate Scenario Exercise
The recognition of climate change as a systemic risk to the global economy has further intensified regulatory and supervisory focus on monitoring of the environmental, social, and governance (ESG) risks.
