FIN-FSA Amends Regulations and Guidelines on Credit Risk Management
FIN-FSA issued amended regulations and guidelines 4/2018 on management of credit risk by supervised entities in the financial sector. The regulations and guidelines will enter into force on February 10, 2020.
The key changes to regulations and guidelines 4/2018 include the following:
- Addition of EBA Guidelines of October 30, 2018 on the management of non-performing and forborne exposures to the regulations and guidelines
- As applicable and subject to requisite additions and revisions, addition of the contents of the letter “To banks operating in Finland on Safeguarding banks’ long-term profitability and customer protection” and contents of the supervision release “20/2010—June 08, 2010: Supervisory release of household housing finance”
- Clarification of lending practices related to housing company credit
The objective of these regulations and guidelines on the management of credit risk is to ensure that supervised entities and entities belonging to the same consolidation group do not take on credit risks that may jeopardize their profitability or capital adequacy, in the course of their lending or investment activities. In addition, the regulations and guidelines aim to ensure that entities have adequate and effective functions in place, commensurate with the nature and scope of their activities, to identify, measure, mitigate, monitor, and control market risk as part of their overall business risk management and control.
Related Links
Effective Date: February 10, 2020
Keywords: Europe, Finland, Banking, Credit Risk, Credit Risk Management, Capital Adequacy, NPLs, FIN-FSA
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
Next Article
PRA Consults on PRA110 Reporting Frequency ThresholdRelated Articles
BIS and Central Banks Experiment with GenAI to Assess Climate Risks
A recent report from the Bank for International Settlements (BIS) Innovation Hub details Project Gaia, a collaboration between the BIS Innovation Hub Eurosystem Center and certain central banks in Europe
Nearly 25% G-SIBs Commit to Adopting TNFD Nature-Related Disclosures
Nature-related risks are increasing in severity and frequency, affecting businesses, capital providers, financial systems, and economies.
Singapore to Mandate Climate Disclosures from FY2025
Singapore recently took a significant step toward turning climate ambition into action, with the introduction of mandatory climate-related disclosures for listed and large non-listed companies
SEC Finalizes Climate-Related Disclosures Rule
The U.S. Securities and Exchange Commission (SEC) has finalized the long-awaited rule that mandates climate-related disclosures for domestic and foreign publicly listed companies in the U.S.
EBA Proposes Standards Related to Standardized Credit Risk Approach
The European Banking Authority (EBA) has been taking significant steps toward implementing the Basel III framework and strengthening the regulatory framework for credit institutions in the EU
US Regulators Release Stress Test Scenarios for Banks
The U.S. regulators recently released baseline and severely adverse scenarios, along with other details, for stress testing the banks in 2024. The relevant U.S. banking regulators are the Federal Reserve Bank (FED), the Federal Deposit Insurance Corporation (FDIC), and the Office of the Comptroller of the Currency (OCC).
Asian Governments Aim for Interoperability in AI Governance Frameworks
The regulatory landscape for artificial intelligence (AI), including the generative kind, is evolving rapidly, with governments and regulators aiming to address the challenges and opportunities presented by this transformative technology.
EBA Proposes Operational Risk Standards Under Final Basel III Package
The European Union (EU) has been working on the final elements of Basel III standards, with endorsement of the Banking Package and the publication of the European Banking Authority (EBA) roadmap on Basel III implementation in December 2023.
EFRAG Proposes XBRL Taxonomy and Standard for Listed SMEs Under ESRS
The European Financial Reporting Advisory Group (EFRAG), which plays a crucial role in shaping corporate reporting standards in European Union (EU), is seeking comments, until May 21, 2024, on the Exposure Draft ESRS for listed SMEs.
ECB to Expand Climate Change Work in 2024-2025
Banking regulators worldwide are increasingly focusing on addressing, monitoring, and supervising the institutions' exposure to climate and environmental risks.
