HKMA reviewed the work done in 2018 and published its priorities for the coming year. The priorities for 2019 are in the areas of implementation of Basel III reform package, suptech as part of the HKMA Digitalization Program, operational resilience and technology risk management, money laundering/terrorist financing risk management, misconduct risk management, liquidity and market risk management, and credit risk management.
The focus areas in credit risk management include small and medium enterprise lending, lending to large corporates, counterparty credit risk management, and loan classification and provisioning. In terms of liquidity and risk management, the HKMA focus will be on assessing—via internal liquidity stress test and contingency funding management—the capability of banks to cope with liquidity shocks and reviewing risk management practices of banks for algorithmic trading. In terms of technology risk management, the focus will be on cyber resilience and recovery, supervision of virtual banks, regtech development, and implementation of Open API.
Keywords: Asia Pacific, Hong Kong, Banking, Work Priorities, Suptech, Regtech, Credit Risk, Market Risk, HKMA
HKMA urged authorized institutions to take early action to adhere to the IBOR Fallbacks Protocol, which ISDA is expected to publish soon.
FSB published a global transition roadmap for London Inter-bank Offered Rate (LIBOR).
HM Treasury published a document that summarizes the responses received from a consultation on the approach of UK to transposition of the revised Bank Resolution and Recovery Directive (BRRD2).
HM Treasury published the government response to the feedback received on the consultation for updating the prudential regime of UK before the end of the Brexit transition period.
PRA published the final policy statement PS22/20, which contains the updated supervisory statement SS12/13 on counterparty credit risk.
FSB published an update on its work to address market fragmentation. FSB is working in this area in collaboration with the other standard-setting bodies.
EBA proposed revisions to the guidelines on major incident reporting under the second Payment Service Directive (PSD2).
EBA published the final draft regulatory technical standards specifying the methodology for prudential treatment of software assets by banks.
FSB published a report presenting the roadmap to enhance cross-border payments by providing a high-level plan that sets ambitious but achievable goals and milestones in the five focus areas.
In a recent communication, EIOPA urged the insurance sector to complete its preparations for the end of the Brexit transition period on December 31, 2020.