BSP Issues Multiple Updates for Financial Institutions in March 2022
The Bangko Sentral ng Pilipinas (BSP) published updates on the digital marketplace model, prudential reporting framework for Islamic banks and banking units, knowledge exchange program on central bank digital currencies (CBDC), and management of cyber risk. BSP also amended the guidelines on computation of minimum required capital and risk-based capital adequacy ratio as well as the amendments to regulations on information technology risk management.
Below are the key highlights of these recent updates from BSP:
- BSP is crafting rules that will allow covered banks and electronic money issuers to establish a digital marketplace whereby they can partner with financial service providers to develop and offer a wide array of financial products and services to consumers under a one-stop-shop platform. The financial products or services to be offered include retail loan products, other retail financial products, retail insurance products, collective investment schemes or pooled investment funds, and other financial products or services as may be authorized by the Monetary Board.
- BSP approved the prudential reporting framework for Islamic banks and Islamic banking units. The reporting framework sets out the accounting treatment of common Islamic banking arrangements as well as guidelines on how selected accounts of Islamic banks and Islamic banking units will be mapped onto the financial statements for prudential reporting purposes. An observation period on the submission of the reports of Islamic banks and Islamic banking units will commence from the reporting period of end of June 2022 until December 31, 2023, with full implementation on March 31, 2024.
- BSP and the Alliance for Financial Inclusion jointly hosted the knowledge-exchange program, which examined the potential and impact of CBDC on financial inclusion and looked at the various design considerations and implementation challenges, including the underlying technology. The BSP Governor highlighted that, as a next step, BSP targets to roll-out in the near term, a pilot CBDC implementation called Project CBDCPh. The project aims to build organizational capacity and hands-on knowledge of key aspects of CBDC that are relevant for a use case around addressing frictions in the national payment system.
- BSP is developing a Financial Services Cyber Resilience Plan, which will serve as the primary framework for strategies to strengthen cyber resilience in the financial services industry. BSP is also developing the Advanced Supervisory Technology Engine for Risk-Based Compliance or ASTERisC that will streamline and automate regulatory supervision as well as reporting and compliance assessment of BSP supervised financial institutions cybersecurity risk management.
- BSP published a circular on amendments to the guidelines on the computation of minimum required capital and risk-based capital adequacy ratio. The key amendments are related to definition of capital, provisions on qualifying capital, regulatory adjustment to common equity tier 1 (CET1) capital, and credit risk-weighted assets. The circular shall take effect fifteen calendar days after its publication either in the Official Gazette or in a newspaper of general circulation.
- BSP published a circular on amendments to regulations on information technology risk management. The amendments incorporate requirements on the adoption of robust fraud management systems and reinforced consumer education and awareness programs to the Manual of Regulations for Banks (MORB) and the Manual of Regulations for non-bank financial institutions. These amendments aim to strengthen cybersecurity posture and minimize losses arising from fraud and cybercriminal activities. This circular shall take effect fifteen calendar days following its publication either in the Official Gazette or any newspaper of general circulation.
Related Links
- Press Release on Financial Inclusion
- Press Release on Digital Marketplace Model
- Press Release on Reporting Framework for Islamic Banks
- Circular on Reporting Guidelines for Islamic Banks
- Press Release on Knowledge Exchange Program on CBDC
- Circular on Amendments to the Guidelines on the Computation of Minimum Required Capital and Risk-Based Capital Adequacy Ratio
- Circular on Amendments to Regulations on Information Technology Risk Management
- Press Release on Cybersecurity
Keywords: Asia Pacific, Philippines, Banking, Digital Marketplace, Islamic Banking, CBDC, Regulatory Capital, Basel, Reporting, Cyber Risk, Regtech, Suptech, Guidelines, BSP, Lending, Platform Businesses, Subheadline
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
Previous Article
ESAs Set Out SFDR Timelines; ESMA Issues Report on Carbon MarketRelated 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.
