Featured Product

    IMF Assesses Implementation of BCPs in Romania Under the FSAP

    June 20, 2018

    IMF published a report on the detailed assessment of observance of the implementation of the Basel Core Principles for Effective Banking Supervision (BCPs) in Romania, under its Financial Sector Assessment Program (FSAP). Out of the 29 principles, Romania was found to be compliant with 11, largely compliant with 15, and materially non-compliant with 3 BCPs. The material non-compliance was with respect to the principles on country and transfer risks; transactions with related parties; and independence, accountability, resourcing, and legal protection for supervisors.

    As an EU member state, Romania is subject and aligned to the EU common regulatory framework for banking supervision. The adoption of the Capital Requirements Regulation and Directive IV (CRR/CRD IV), which forms the Single Rule Book, was an important step toward stronger prudential regulation. Prudential regulations of the National Bank of Romania (NBR) are broadly aligned to the requirements of BCPs. As of 2017, NBR has identified 11 banks as "systematically important," of which 8 are supervised at group level by the Single Supervisory Mechanism. Some of the key IMF recommendations are as follows:

    • Devote further supervisory attention to risk models, including advanced approach for regulatory capital calculation.
    • Conduct a thematic review on the large exposure limit across banks and review the suitability of EUR 150 million as an absolute limit.
    • Review and amend the regulation on affiliated party transactions in a more prudent manner.
    • Improve the prudential reporting template on related party transactions for more effective monitoring and issue a guidance note/instruction that lays down more concrete requirements for monitoring and managing related party transactions.
    • Perform a periodic review of whether the prudential returns (required outside of European reporting framework) satisfy supervisory needs.
    • Update current regulation based on EU-wide regulatory amendment process reflecting new standards for IRRBB, which were published in April 2016.
    • Include explicit requirements in the regulation that banks include appropriate scenarios into their stress testing programs to reflect country and transfer risk analysis.
    • Expand the scope and required items of reporting on operational risk events to keep the NBR apprised of developments affecting operational risk.
    • Consider the opportunity to require, at least for significant banks, more frequent disclosure (than on an annual basis).
    • Introduce a legal provision protecting the NBR as an institution against lawsuits for actions taken and/or omissions made while discharging its duties in good faith.

     

    Related Link: Detailed Assessment of BCPs

    Keywords: Europe, EU, Romania, Banking, FSAP, BCP, CRR/CRD, IMF

    Related Articles
    News

    BoE Clarifies Approach to Treatment of Payment Holidays on Form PL

    BoE published a statistical notice (Notice 2020/9) explaining the approach for treatment of payment holidays on the profit and loss return or Form PL.

    August 11, 2020 WebPage Regulatory News
    News

    BoE Provides Reporting Update on Form AS and Form FV

    BoE updated the known issues document for the statistical reporting Forms AS and FV.

    August 10, 2020 WebPage Regulatory News
    News

    FED Announces Capital Requirements for Large Banks

    FED announced individual capital requirements for 34 large banks and these requirements go into effect on October 01, 2020.

    August 10, 2020 WebPage Regulatory News
    News

    SRB Publishes Guidance on Implementation of Bail-In Tool

    SRB published a set of documents to give operational guidance to banks on implementation of the bail-in tool.

    August 10, 2020 WebPage Regulatory News
    News

    BIS Publishes Update on G20 TechSprint Initiative

    BIS published an update on the G20 TechSprint Initiative, which was launched in April 2020 and aims to highlight the potential for technologies to resolve regulatory compliance (regtech) and supervisory (suptech) challenges.

    August 10, 2020 WebPage Regulatory News
    News

    OSFI Provides Update on Implementation of IFRS 17 in Canada

    OSFI published a letter that provides an update on the milestones for the implementation of the IFRS 17 standard on insurance contracts.

    August 07, 2020 WebPage Regulatory News
    News

    EBA Provides Clarity on Implementation of Guidance on COVID Reporting

    EBA updated the report on the implementation of selected COVID-19 policies.

    August 07, 2020 WebPage Regulatory News
    News

    FSI Note Discusses Challenges Associated with COVID Relief Measures

    The Financial Stability Institute (FSI) of BIS published a brief note that examines the supervisory challenges associated with certain temporary regulatory relief measures introduced by BCBS and prudential authorities in response to the COVID-19 pandemic.

    August 06, 2020 WebPage Regulatory News
    News

    BCBS Consults on Principles for Operational Risk and Resilience

    BCBS is consulting on the principles for operational resilience and the revisions to the principles for sound management of operational risk for banks.

    August 06, 2020 WebPage Regulatory News
    News

    BoE Updates Template and Definitions for Form ER

    BoE updated the reporting template for Form ER as well as the Form ER definitions, which contain guidance on the methodology to be used in calculating annualized interest rates.

    August 05, 2020 WebPage Regulatory News
    RESULTS 1 - 10 OF 5649