HKMA Proposes Revisions to Policy Module on Conduct at Banks
HKMA is consulting the banking industry on revisions to the Supervisory Policy Module CG-3 on Code of Conduct, with the comment period closing on April 09, 2021. The proposed revisions have been highlighted in track changes, with key revisions relating to the Application, Oversight by Senior Management, and Internal Control sections of the module. In general, the module sets out the minimum standards that HKMA expects authorized institutions to adopt in respect of their codes of conduct and elements of an effective system for enforcing the Codes.
The policy module applies to all authorized institutions. In the case of locally incorporated authorized institutions, the scope should cover all their branches and subsidiaries subject to the consolidated supervision of HKMA. An overseas-incorporated authorized institution may adopt the Code of Conduct formulated at the group level if it can demonstrate to the satisfaction of HKMA that the relevant group policy is consistent with the requirements set out in this module, or with certain other prescribed conditions. Failure to adhere to the standards and requirements in this module may call into question whether an authorized institution continues to satisfy certain criteria under seventh Schedule to the Banking Ordinance. This module should be read in conjunction with other relevant Supervisory Policy Manual modules, including CG-1 “Corporate Governance of Locally Incorporated Authorized Institutions” in the case of locally incorporated authorized institutions, CG-5 “Guideline on a Sound Remuneration System,” and CG-6 “Competence and Ethical Behavior,” as well as any other applicable guidance issued and updated by HKMA.
Comment Due Date: April 09, 2021
Keywords: Asia Pacific, Hong Kong, Banking, Code of Conduct, Banking Ordinance, Supervisory Policy Manual, Governance, Operational Risk, HKMA
Previous Article
FSC Taiwan Grants License to Internet-Only Banks in TaiwanRelated Articles
HKMA Finalizes Policy Modules on Group-Wide Approach and Remuneration
The Hong Kong Monetary Authority (HKMA) revised the Supervisory Policy Manual module CG-5 that sets out guidelines on a sound remuneration system for authorized institutions.
EBA Guide to Monitor Threshold for Intermediate Parent Undertakings
The European Banking Authority (EBA) published the final guidelines on the monitoring of the threshold and other procedural aspects on the establishment of intermediate parent undertakings in European Union (EU), as laid down in the Capital Requirements Directive (CRD).
PRA Finalizes Approach to Supervision of International Banks
In a recent Market Notice, the Bank of England (BoE) confirmed that green gilts will have equivalent eligibility to existing gilts in its market operations.
FCA Issues PS21/9 on Implementation of Investment Firms Regime
The Financial Conduct Authority (FCA) published the policy statement PS21/9 on implementation of the Investment Firms Prudential Regime.
EBA Proposes Regulatory Standards to Identify Shadow Banking Entities
The European Banking Authority (EBA) proposed regulatory technical standards that set out criteria for identifying shadow banking entities for the purpose of reporting large exposures.
IOSCO Proposes Recommendations on ESG Ratings and Data Providers
The Board of the International Organization of Securities Commissions (IOSCO) proposed a set of recommendations on the environmental, social, and governance (ESG) ratings and data providers.
ESMA Group Issues Recommendations on RFR Switch in Interdealer Market
The European Securities and Markets Authority (ESMA) published recommendations from the Working Group on Euro Risk-Free Rates (RFR) on the switch to risk-free rates in the interdealer market.
ECB Study Assesses Impact of Basel III Finalization Package
The European Central Bank (ECB) published a paper as well as an article in the July Macroprudential Bulletin, both of which offer insights on the assessment of the impact of Basel III finalization package on the euro area.
ISDA Finds FRTB Results in Higher Capital Charges for Carbon Trading
The International Swaps and Derivatives Association (ISDA) published a paper that explores the impact of the Fundamental Review of the Trading Book (FRTB) on the trading of carbon certificates.
PRA Updates Remuneration Policy Statement Templates and Tables
The Prudential Regulation Authority (PRA) published the remuneration policy self-assessment templates and tables on strengthening accountability.
