Featured Product

    DFSA Issues Guidance on Capital Adequacy and Solvency Requirements

    February 09, 2021

    DFSA published the guidance on capital adequacy and solvency requirement for credit institutions. Post consultation, DFSA has clarified the use of language in relevant places on the basis of the responses received. The guidance sets out benchmarks and calculation methods for credit, market, liquidity, and operational risks. It also sets out special conditions for internal ratings-based institutions, along with information on the stress test calculations.

    The guidance sets out that credit institutions must calculate the solvency requirements in accordance with the institution's risk profile and the conditions under which the institution conducts its business, according to Appendix 1 in the Executive Order on the calculation of risk exposures, capital base, and solvency requirements for credit institution. The guidance contains requirements for large credit institutions regarding sensitivity analyses, including a description of the special risk areas that institutions issuing covered bonds and covered mortgage bonds must observe. Overall, the guidance contributes to a clearer framework for the institutions in the calculation of capital adequacy and solvency requirements.

    In addition to this guidance, DFSA published a report on the study of mortgage loans with long-term grace period. The mortgage loans that are the subject of the study give borrowers the option of a grace period of up to 30 years. The study shows that four largest mortgage banks in Denmark offer mortgage loans to consumers, which allows for long-term repayment freedom and variable interest rates. The study shows that the institutions are aware of the risks that apply in relation to these types of loans and that the institutions, in their guidance processes, ensure that borrowers are aware and clarify that they must be creditworthy in a longer perspective.

     

    Related Links (in Danish)

    Keywords: Europe, Denmark, Banking, Securities, Regulatory Capital, Credit Risk, Market Risk, Liquidity Risk, Operational Risk, DFSA

    Featured Experts
    Related Articles
    News

    US Agencies Issue Several Regulatory and Reporting Updates

    The Board of Governors of the Federal Reserve System (FED) adopted the final rule on Adjustable Interest Rate (LIBOR) Act.

    January 04, 2023 WebPage Regulatory News
    News

    ECB Issues Multiple Reports and Regulatory Updates for Banks

    The European Central Bank (ECB) published an updated list of supervised entities, a report on the supervision of less significant institutions (LSIs), a statement on macro-prudential policy.

    January 01, 2023 WebPage Regulatory News
    News

    HKMA Keeps List of D-SIBs Unchanged, Makes Other Announcements

    The Hong Kong Monetary Authority (HKMA) published a circular on the prudential treatment of crypto-asset exposures, an update on the status of transition to new interest rate benchmarks.

    December 30, 2022 WebPage Regulatory News
    News

    EU Issues FAQs on Taxonomy Regulation, Rules Under CRD, FICOD and SFDR

    The European Commission (EC) adopted the standards addressing supervisory reporting of risk concentrations and intra-group transactions, benchmarking of internal approaches, and authorization of credit institutions.

    December 29, 2022 WebPage Regulatory News
    News

    CBIRC Revises Measures on Corporate Governance Supervision

    The China Banking and Insurance Regulatory Commission (CBIRC) issued rules to manage the risk of off-balance sheet business of commercial banks and rules on corporate governance of financial institutions.

    December 29, 2022 WebPage Regulatory News
    News

    HKMA Publications Address Sustainability Issues in Financial Sector

    The Hong Kong Monetary Authority (HKMA) made announcements to address sustainability issues in the financial sector.

    December 23, 2022 WebPage Regulatory News
    News

    EBA Updates Address Basel and NPL Requirements for Banks

    The European Banking Authority (EBA) published regulatory standards on identification of a group of connected clients (GCC) as well as updated the lists of identified financial conglomerates.

    December 22, 2022 WebPage Regulatory News
    News

    ESMA Publishes 2022 ESEF XBRL Taxonomy and Conformance Suite

    The General Board of the European Systemic Risk Board (ESRB), at its December meeting, issued an updated risk assessment via the quarterly risk dashboard and held discussions on key policy priorities to address the systemic risks in the European Union.

    December 22, 2022 WebPage Regulatory News
    News

    FCA Sets up ESG Committee, Imposes Penalties, and Issues Other Updates

    The Financial Conduct Authority (FCA) is seeking comments, until December 21, 2022, on the draft guidance for firms to support existing mortgage borrowers.

    December 20, 2022 WebPage Regulatory News
    News

    FSB Reports Assess NBFI Sector and Progress on LIBOR Transition

    The Financial Stability Board (FSB) published a report that assesses progress on the transition from the Interbank Offered Rates, or IBORs, to overnight risk-free rates as well as a report that assesses global trends in the non-bank financial intermediation (NBFI) sector.

    December 20, 2022 WebPage Regulatory News
    RESULTS 1 - 10 OF 8697