JFSA Amends Notices on IFRS 9 and Capital Adequacy Requirements
JFSA published, in the Official Gazette, amendments to the regulatory notice of the "designated International Financial Reporting Standards" stipulated in the "Regulation for Terminology, Forms, and Preparation of Consolidated Financial Statements." The designated reporting standards are IFRS 9 on financial instruments, IAS 39 on recognition and measurement of financial instruments, and IFRS 7 on disclosure of financial instruments. The amended regulatory notice has been enforced on March 19, 2020. JFSA also published results of the consultation on amendments to the regulatory notices related to capital adequacy (Pillar 1 requirements).
The amendments to the regulatory notices related to capital adequacy mainly revise the capital adequacy regulation on double-gearing (restriction on banks' investments in other banks). JFSA received a total of eights comments on the consultation. The amended regulatory notices and supervisory guidelines will be applied from the date of promulgation, which will be announced in due course.
Additionally, JFSA proposed draft amendments to the comprehensive guidelines for supervision of major banks, small, medium and regional financial institutions, insurance companies, and other institutions, along with the draft regulatory notice that highlights documents to be submitted to the JFSA pursuant to the provisions of Article 349 of the "Cabinet Office Order on Financial Instruments Business, etc." To improve administrative procedures utilizing information and communications technology and ensure simplification and efficiency of administrative operations, the proposal intends to expressly set forth in the guidelines the specifics of administrative procedures through online application. Opinions on the proposal are requested by April 13, 2020.
Effective Date: March 19, 2020
Keywords: Asia Pacific, Japan, Banking, Insurance, Financial Instruments, IFRS 9, IAS 39, Dislcosures, IFRS 7, Pillar 1, Capital Adequacy, Basel, Regulatory Capital, JFSA
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.

Anna Krayn
CECL adoption expert; engagement manager for loss estimation, internal risk capability enhancement, and counterparty credit risk management
Related Articles
FINMA Approves Merger of Credit Suisse and UBS
The Swiss Financial Market Supervisory Authority (FINMA) has approved the takeover of Credit Suisse by UBS.
BOE Sets Out Its Thinking on Regulatory Capital and Climate Risks
The Bank of England (BOE) published a working paper that aims to understand the climate-related disclosures of UK financial institutions.
OSFI Finalizes on Climate Risk Guideline, Issues Other Updates
The Office of the Superintendent of Financial Institutions (OSFI) is seeking comments, until May 31, 2023, on the draft guideline on culture and behavior risk, with final guideline expected by the end of 2023.
APRA Assesses Macro-Prudential Policy Settings, Issues Other Updates
The Australian Prudential Regulation Authority (APRA) published an information paper that assesses its macro-prudential policy settings aimed at promoting stability at a systemic level.
BIS Paper Examines Impact of Greenhouse Gas Emissions on Lending
BIS issued a paper that investigates the effect of the greenhouse gas, or GHG, emissions of firms on bank loans using bank–firm matched data of Japanese listed firms from 2006 to 2018.
HMT Mulls Alignment of Ring-Fencing and Resolution Regimes for Banks
The HM Treasury (HMT) is seeking evidence, until May 07, 2023, on practicalities of aligning the ring-fencing and the banking resolution regimes for banks.
MFSA Sets Out Supervisory Priorities, Issues Reporting Updates
The Malta Financial Services Authority (MFSA) outlined its supervisory priorities for 2023
German Regulators Issue Multiple Reporting Updates for Banks
Deutsche Bundesbank published the nationally deactivated validation rules for the German Commercial Code (HGB) users on the taxonomy 3.2, which became valid from December 31, 2022
BCBS Report Examines Impact of Basel III Framework for Banks
The Basel Committee on Banking Supervision (BCBS) published results of the Basel III monitoring exercise based on the June 30, 2022 data.
PRA Consults on Prudential Rules for "Simpler-Regime" Firms
Among the recent regulatory updates from UK authorities, a key development is the first-phase consultation, from the Prudential Regulation Authority (PRA), on simplifications to the prudential framework that would apply to the simpler-regime firms.