BoE Proposed Policy on Valuation Capabilities to Support Resolvability
BoE is consulting on the policy on valuation capabilities to support resolvability. The consultation sets out BoE’s proposed policy for the capabilities that firms should have in place to ensure that an inability to produce timely and robust resolution valuation does not impede resolvability. The responses are requested by November 17, 2017.
The consultation paper explains the role of valuations in resolution and the potential for valuation capabilities to constitute a barrier to resolvability. It sets out the proposed policy approach and its application, along with the proposed objectives for resolution valuation capabilities. The paper also contains proposed principles for resolution valuation capabilities, along with the rationale for these. The proposed policy includes principles for the data, information, models, processes, and governance arrangements that firms are expected to establish, maintain, and demonstrate. The firms would be expected to have capabilities in place to support the objective that valuations are sufficiently timely and robust not to impede the effectiveness of their preferred resolution strategy. The preliminary impact assessment provides a preliminary qualitative assessment of the costs and benefits of BoE's proposed valuations policy. BoE will use feedback received on this consultation paper to ensure effectiveness of any policy adopted in the future. The proposed policy applies to UK-based firms whose preferred resolution strategy involves the use of stabilization powers and to material UK subsidiaries of overseas-based banking groups.
Related Link: Consultation Paper (PDF)
Comment Due Date: November 17, 2017
Keywords: Europe, United Kingdom, Banking, Valuation Capabilities, Resolvability, Resolution Planning, BoE
Next Article
FSB Publishes Peer Review of KoreaRelated Articles
SEC Finalizes Climate-Related Disclosures Rule
The U.S. Securities and Exchange Commission (SEC) has finalized the long-awaited rule that mandates climate-related disclosures for domestic and foreign publicly listed companies in the U.S.
US Regulators Release Stress Test Scenarios for Banks
The U.S. regulators recently released baseline and severely adverse scenarios, along with other details, for stress testing the banks in 2024. The relevant U.S. banking regulators are the Federal Reserve Bank (FED), the Federal Deposit Insurance Corporation (FDIC), and the Office of the Comptroller of the Currency (OCC).
Asian Governments Aim for Interoperability in AI Governance Frameworks
The regulatory landscape for artificial intelligence (AI), including the generative kind, is evolving rapidly, with governments and regulators aiming to address the challenges and opportunities presented by this transformative technology.
EBA Proposes Operational Risk Standards Under Final Basel III Package
The European Union (EU) has been working on the final elements of Basel III standards, with endorsement of the Banking Package and the publication of the European Banking Authority (EBA) roadmap on Basel III implementation in December 2023.
EFRAG Proposes XBRL Taxonomy and Standard for Listed SMEs Under ESRS
The European Financial Reporting Advisory Group (EFRAG), which plays a crucial role in shaping corporate reporting standards in European Union (EU), is seeking comments, until May 21, 2024, on the Exposure Draft ESRS for listed SMEs.
ECB to Expand Climate Change Work in 2024-2025
Banking regulators worldwide are increasingly focusing on addressing, monitoring, and supervising the institutions' exposure to climate and environmental risks.
BIS Bulletin Examines Cognitive Limits of Large Language Models
The use cases of generative AI in the banking sector are evolving fast, with many institutions adopting the technology to enhance customer service and operational efficiency.
ECB is Conducting First Cyber Risk Stress Test for Banks
As part of the increasing regulatory focus on operational resilience, cyber risk stress testing is also becoming a crucial aspect of ensuring bank resilience in the face of cyber threats.
EBA Continues Momentum Toward Strengthening Prudential Rules for Banks
A few years down the road from the last global financial crisis, regulators are still issuing rules and monitoring banks to ensure that they comply with the regulations.
EU and UK Agencies Issue Updates on Final Basel III Rules
The European Commission (EC) recently issued an update informing that the European Council and the Parliament have endorsed the Banking Package implementing the final elements of Basel III standards