APRA Keeps CCyB at Zero, Updates FAQs on Liquidity Standards
APRA updated the frequently asked questions (FAQs) on liquidity risk standards for authorized deposit-taking institutions. As part of this update, APRA has published new FAQs on minimum liquidity holdings, mortgage warehouse facilities, and calculation of collateral outflows. The FAQs provide further information to assist regulated entities in the interpretation of the prudential standard APS 210, the prudential practice guide APG 210, and the reporting standard ARS 210.0 on liquidity risk management. APRA also published an information paper setting out its decision on the quarterly assessment of the countercyclical capital buffer (CCyB) for authorized deposit-taking institutions.
APRA confirmed that, for the authorized deposit-taking institutions, a CCyB of 0% remains appropriate, based on an assessment of the systemic risk environment in the country. The CCyB is likely to remain at this level until at least the end of 2021. APRA reviews the buffer quarterly and may adjust it if future circumstances warrant this. CCyB has been set at 0% of the risk-weighted assets since it was introduced in 2016. However, APRA has already flagged its intention to introduce a non-zero default level for the CCyB and has outlined a proposal to do this as part of the consultation on making the capital framework for authorized deposit-taking institutions more risk-sensitive, flexible, and transparent. This set of reforms will not come into effect until the beginning of 2023. APRA expects to commence the next stage of its consultation on the authorized deposit-taking institutions' capital in the first half of next year. The revised capital framework of APRA is currently scheduled to come into effect from January 01, 2022.
Related Links
Keywords: Asia Pacific, Australia, Banking, CCyB, Regulatory Capital, FAQ, Liquidity Risk, Basel, Systemic Risk, Reporting, APRA
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
US Agencies Propose to Revise and Extend Call Reports for BanksRelated Articles
OSFI Finalizes on Climate Risk Guideline, Issues Other Updates
The Office of the Superintendent of Financial Institutions (OSFI) is seeking comments, until May 31, 2023, on the draft guideline on culture and behavior risk, with final guideline expected by the end of 2023.
BIS Paper Examines Impact of Greenhouse Gas Emissions on Lending
BIS issued a paper that investigates the effect of the greenhouse gas, or GHG, emissions of firms on bank loans using bank–firm matched data of Japanese listed firms from 2006 to 2018.
HMT Mulls Alignment of Ring-Fencing and Resolution Regimes for Banks
The HM Treasury (HMT) is seeking evidence, until May 07, 2023, on practicalities of aligning the ring-fencing and the banking resolution regimes for banks.
BCBS Report Examines Impact of Basel III Framework for Banks
The Basel Committee on Banking Supervision (BCBS) published results of the Basel III monitoring exercise based on the June 30, 2022 data.
PRA Consults on Prudential Rules for "Simpler-Regime" Firms
Among the recent regulatory updates from UK authorities, a key development is the first-phase consultation, from the Prudential Regulation Authority (PRA), on simplifications to the prudential framework that would apply to the simpler-regime firms.
DNB Publishes Multiple Reporting Updates for Banks
DNB, the central bank of Netherlands, updated the list of additional reporting requests and published additional data quality checks and XBRL-Formula linkbase documents for the first quarter of 2023.
NBB Sets Out Climate Risk Expectations, Issues Reporting Updates
The National Bank of Belgium (NBB) published a communication on climate-related and environmental risks, issued an update on XBRL reporting
EBA Updates Address Securitization Standards and DGS Guidelines
The European Banking Authority (EBA) published the final draft of the regulatory technical standards that set out conditions for assessment of homogeneity of the underlying exposures in simple, transparent, and standardized (STS) securitizations.
FSB Publishes Letter to G20, Sets Out Work Priorities for 2023
The Financial Stability Board (FSB) published a letter intended for the G20 Finance Ministers and Central Bank Governors, highlighting the work that FSB will take forward under the Indian G20 Presidency in 2023
ISSB Standards May Become Effective from January 2024
The International Organization of Securities Commissions (IOSCO) welcomed the confirmation statement by the International Sustainability Standards Board (ISSB) setting out its progress in the development of its first sustainability-related corporate disclosure standards.
