Featured Product

    CBIRC Finalizes Measures for Managing Large Exposures of Banks

    May 04, 2018

    CBIRC issued rules for the management of large-scale exposures of commercial banks, with July 01, 2018 as the effective date. The rules are intended to prevent and control concentration risk in the Chinese banking sector. These rules are in line with the supervisory framework for measuring and controlling large exposures, which the BCBS issued in April 2014.

    The large-scale exposures framework includes chapters on general provisions, regulatory requirements for large exposures, calculation of risk exposures, management of large exposures, supervision and administration, and by-laws. The appendices cover customer identification method, specific risk exposure calculation method, trading account risk exposure calculation method, off-balance-sheet project credit conversion coefficient, qualified material and qualified guarantee range, and phased transitional compliance requirements. The measures stipulate the scope and methods for the calculation of risk exposure and set requirements for commercial banks to strengthen “large-scale risk management” in terms of organizational structure, management systems, internal limits, and information systems for business.

    The rules stipulate that exposure of a commercial bank to a single customer in the same industry or a group customer shall not exceed 25% of the net value of tier 1 capital. The risk exposure of a global systemically important bank to another global systemically important bank may not exceed 15% of the net tier 1 capital. The liquidation risk exposure of commercial banks to a single qualified central counterparty is not subject to the large-scale risk exposure supervision requirements stipulated in the present rules and the non-liquidation risk exposure may not exceed 25% of the net value of tier 1 capital. Moreover, the risk exposure and non-liquidation exposure of a commercial bank to a single unqualified central counterparty shall not exceed 25% of the net value of tier 1 capital.  


    Related Links

    Effective Date: July 01, 2018

    Keywords: Asia Pacific, China, Banking, Concentration Risk, Large Exposures, CBIRC

    Related Articles
    News

    EIOPA Report Analyzes Use and Impact of Long-Term Guarantee Measures

    EIOPA submitted—to the European Parliament, the Council of the European Union, and EC—its 2020, fifth, and last annual report on long-term guarantee measures and measures on equity risk.

    December 03, 2020 WebPage Regulatory News
    News

    BIS, SNB, and SIX Announce Successful Completion of CBDC POC

    The BIS Innovation Hub Swiss Centre, SNB, and the financial infrastructure operator SIX announced the successful completion of a joint proof-of-concept (PoC) experiment as part of the Project Helvetia.

    December 03, 2020 WebPage Regulatory News
    News

    EBA Sets Out Treatment of Certain Banking Book Positions Under FRTB

    EBA published the final draft regulatory technical standards for calculation of own funds requirements for market risk, under the standardized and internal model approaches of the Fundamental Review of the Trading Book (FRTB) framework.

    December 03, 2020 WebPage Regulatory News
    News

    EIOPA Consults on Integrating Climate Change into SII Standard Formula

    EIOPA published discussion paper on a methodology for the potential inclusion of climate change in the Solvency II (sometimes also written as SII) standard formula when calculating natural catastrophe underwriting risk.

    December 02, 2020 WebPage Regulatory News
    News

    EU Issues Corrigenda to Investment Firms Directive and Regulation

    EU published, in the Official Journal of the European Union, corrigenda to the Directive and the Regulation on the prudential requirements and supervision of investment firms.

    December 02, 2020 WebPage Regulatory News
    News

    MAS Proposes Changes to Rules Arising from Banking Amendment Act

    MAS proposed amendments to certain regulations, notices, and guidelines arising from the Banking (Amendment) Act 2020.

    December 02, 2020 WebPage Regulatory News
    News

    PRA to Elaborate on Approach to Transposition of CRD5 by Mid-December

    PRA published a statement that explains when to expect further information on the PRA approach to transposing the Capital Requirements Directive (CRD5), including its approach to revisions to the definition of capital for Pillar 2A.

    November 30, 2020 WebPage Regulatory News
    News

    RBNZ Consults on Aspects of Insurance Act, Solvency Standards & IFRS17

    RBNZ launched consultations on the scope of the Insurance Prudential Supervision Act (IPSA) 2010 and on the associated Insurance Solvency Standards.

    November 30, 2020 WebPage Regulatory News
    News

    SRB Sets Out Work Program for 2021-2023

    SRB published the work program for 2021-2023, setting out a roadmap to further operationalize the Single Resolution Fund and to achieve robust resolvability of banks under its remit over the next three years.

    November 30, 2020 WebPage Regulatory News
    News

    EIOPA Consults on KPIs on Sustainability for Non-Financial Reporting

    EIOPA is consulting on the relevant ratios to be mandatorily disclosed by insurers and reinsurers falling within the scope of the Non-Financial Reporting Directive as well as on the methodologies to build these ratios.

    November 30, 2020 WebPage Regulatory News
    RESULTS 1 - 10 OF 6191