HKMA Publishes List of Systemically Important Banks in Hong Kong
HKMA published the list of institutions that have been designated as domestic systemically important authorized institutions, or D-SIBs, as of January 01, 2020, along with the associated Higher Loss Absorbency (HLA) requirements for these institutions. The list of authorized institutions designated as D-SIBs remains unchanged compared to the list of D-SIBs published on December 21, 2018. However, the HLA requirement for Standard Chartered Bank (Hong Kong) Limited has been increased from 1.0% to 1.5% while the HLA requirement for Hang Seng Bank Limited has been reduced from 1.5% to 1.0%.
The D-SIBs in bucket 1, which have an HLA requirement of 1%, are Bank of East Asia Limited, Hang Seng Bank Limited, and Industrial and Commercial Bank of China (Asia) Limited. The D-SIBs in bucket 2, which have an HLA requirement of 1.5%, are Bank of China (Hong Kong) Limited and Standard Chartered Bank (Hong Kong) Limited. Additionally, HSBC Limited has been included in bucket 4, with an HLA requirement of 2.5%
Under the D-SIB framework, each authorized institution that is designated as a D-SIB will be required to include a HLA requirement into the calculation of its regulatory capital buffers within a period of 12 months after formal notification of the designation. The HLA requirement applicable to a D-SIB ranges between 1.0% and 3.5% (depending on the assessed level of systemic importance of a D-SIB).
Keywords: Asia Pacific, Hong Kong, Banking, Banking Capital Rules, HLA, D-SIBs, Systemic Risk, Basel III, BCBS, HKMA
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
Related Articles
APRA Issues Interim Update to Policy Priorities for 2021 and Beyond
In a letter addressed to the industry, the Australian Prudential Regulation Authority (APRA) set out an updated schedule of policy priorities for the banking, insurance, and superannuation industries.
EC Adopts Solvency II and Resolution Rules Package for Insurers
The European Commission (EC) adopted a comprehensive review package of Solvency II rules in the European Union.
OCC Issues Booklets on Regulatory Reporting and Earnings
The Office of the Comptroller of the Currency (OCC) issued Versions 1.0 of the "Earnings" and "Regulatory Reporting" booklets of the Comptroller's Handbook.
ECB Sets Out Results of Economy-Wide Climate Stress Tests
The European Central Bank (ECB) published results of its economy-wide climate stress test, which aimed to assess the resilience of non-financial corporates and euro area banks to climate risks.
EBA Examines Implications of Increasing Use of Digital Platforms in EU
The European Banking Authority (EBA) published a report on the use of digital platforms in the banking and payments sector in European Union.
HKMA Issues Updates on Policy Measures Intended to Ease COVID Impact
The Hong Kong Monetary Authority (HKMA) published updates on the policy measures that were announced in context of the ongoing pandemic.
ISDA Responds to BCBS Proposal on Treatment of Cryptoasset Exposures
The International Swaps and Derivatives Association (ISDA), along with several other associations, submitted a joint response to the Basel Committee on Banking Supervision (BCBS) consultation on preliminary proposals for the prudential treatment of cryptoasset exposures.
BIS Quarterly Review Discusses Developments in Fintech and ESG Space
BIS published the September issue of the Quarterly Review, which contains special features that analyze the rapid rise in equity funding for financial technology firms, the effectiveness of policy measures in response to pandemic, and the evolution of international banking.
BCBS to Consult on Supervisory Practices for Climate Risks by Year-End
The Basel Committee for Banking Supervision (BCBS) met in September 2021 and reviewed climate-related financial risks, discussed impact of digitalization, and welcomed efforts by the International Financial Reporting Standards (IFRS) Foundation to develop a common set of sustainability reporting standards
OCC Identifies Operational Risk Deficiencies in MUFG Union Bank
The Office of the Comptroller of the Currency (OCC) issued a Cease and Desist Order against MUFG Union Bank for deficiencies in technology and operational risk governance.
