Featured Product

    IMF Publishes Reports on the 2017 Article IV Consultation with Uruguay

    January 31, 2018

    IMF published its staff report and selected issues report in the context of the 2017 Article IV consultation with Uruguay. The staff report reveals that the banking sector in Uruguay is small relative to the size of the economy. The results of this exercise highlight that the authorities considered that the financial system was stable and well-supervised, with limited financial stability risks.

    The staff report reveals that the banking sector in the country is well-capitalized, but bank credit remains weak. With the regulatory capital to risk-weighted assets ratio increasing since December 2015, the banking sector has comfortable buffers. Maintaining the stability of the banking sector is a priority. Banks’ operating costs are high; non-performing loans have risen; and bank profitability has declined in the wake of the peso appreciation in 2016 (since most banks were long in U.S. dollars). Although non-performing loans have increased in the last few years, they remain moderate, at less than 4%, and are covered by provisions and excess capital.

    Nonetheless, stability risks to the banking system remain limited, as evidenced by the authorities’ stress tests, and are supported by rising capital-asset ratios. Supervision should continue to closely monitor banks’ exposures, assisted by the implementation of the International Financial Reporting Standards (slated for 2018). The recent steps to implement Basel III—including the phased introduction of the 2.5% capital conservation buffer, capital surcharges for larger banks, and of liquidity ratio regulations—are useful risk-mitigation measures. Moreover, the authorities created a fintech working group to analyze Uruguay’s noticeable position in this sector. The authorities also highlighted their six-month “e-peso” pilot project, for digital currency issued by the central bank.

    The selected issues report investigates the impact of exchange rate movements on private consumption in Uruguay and examines next steps for promoting de-dollarization in the country.

     

    Related Links

    Keywords: Americas, Uruguay, Banking, Financial Stability, Basel III, NPLs, IMF

    Featured Experts
    Related Articles
    News

    APRA Announces Deferral of Capital Reform Implementation

    APRA announced that it is deferring the scheduled implementation of Basel III reforms in Australia by one year.

    March 30, 2020 WebPage Regulatory News
    News

    IFRS Publishes Statement on Its Work During the COVID-19 Crisis

    IFRS, in its statement, emphasized that it shares global concerns about the impact of COVID–19 and is supporting its stakeholders by reconsidering timelines of its meetings and publications, providing information on the application of IFRS 9 on financial instruments, and offering calendar updates on ongoing activities.

    March 27, 2020 WebPage Regulatory News
    News

    US Agencies Announce Changes to SA-CCR and CECL Rules Due to COVID-19

    In light of the recent disruptions in economic conditions due to the COVID-19 outbreak, US Agencies (FDIC, FED, and OCC) announced two actions to allow banking organizations to continue lending to households and businesses.

    March 27, 2020 WebPage Regulatory News
    News

    IAIS Adjusts Work Program to Address Impact of COVID-19 on Insurers

    Considering the impact of COVID-19 outbreak, IAIS announced initial adjustments to its work program to provide operational relief to its member supervisors, insurers, and other stakeholders.

    March 27, 2020 WebPage Regulatory News
    News

    OSFI Announces Regulatory Adjustments to Support COVID-19 Efforts

    OSFI published three targeted industry letters that announce a series of regulatory adjustments to support the financial and operational resilience of federally regulated banks, insurers, and private pension plans in the light of COVID-19.

    March 27, 2020 WebPage Regulatory News
    News

    UK Regulators Announce Measures to Address Impact of COVID-19

    UK Regulatory Authorities published statements and guidance addressed to financial entities on dealing with the impact of the coronavirus (COVID-19) outbreak.

    March 26, 2020 WebPage Regulatory News
    News

    ISDA and Industry Request Delay in Timeline for Initial Margin Rules

    Considering the challenges posed by the COVID-19 pandemic, ISDA submitted a letter on behalf of 21 industry associations and their members requesting BCBS, IOSCO, and global regulators to suspend the current timeline for the initial margin phase-in.

    March 26, 2020 WebPage Regulatory News
    News

    FCA, FRC, and PRA Issue Joint Statement to Address Impact of COVID-19

    In response to the COVID-19 outbreak, FCA, the Financial Reporting Council (FRC), and PRA have announced a series of actions and made statements to support the continued functioning of capital markets in the UK.

    March 26, 2020 WebPage Regulatory News
    News

    EC Rule Corrects Regulation Supplementing Solvency II Directive

    EC published the EU Delegated Regulation 2020/442, which corrects the EU Delegated Regulation 2015/35 that supplements Solvency II Directive (2009/138/EC).

    March 26, 2020 WebPage Regulatory News
    News

    FED and FFIEC Offer Reporting Relief to Institutions Due to COVID-19

    FED and FFIEC announced regulatory reporting relief to financial institutions due to disruptions caused by the COVID-19.

    March 26, 2020 WebPage Regulatory News
    RESULTS 1 - 10 OF 4900