MAS Consults on Implementation of Final Basel III Reforms in Singapore
MAS proposed revisions to the risk-based capital requirements and leverage ratio requirements for banks incorporated in Singapore. These revisions implement the final Basel III reforms published by BCBS, covering the minimum capital requirements for market risk (published in January 2019) and the revised standards for credit risk, credit valuation adjustment, operational risk, output floor, and the leverage ratio (published in December 2017). Comment period on the consultation ends on July 08, 2019 and MAS proposed to implement the revisions from January 01, 2022.
In the consultation document, MAS sets out its policy proposals for implementation of specific aspects of the Basel III reforms:
- MAS intends to adopt the revised credit risk framework, market risk framework, and operational risk framework with proposals on the exercise of national discretions.
- MAS proposes to adopt the phase-in arrangement of BCBS for the output floor calibration.
- MAS proposes to require derivative exposures to be measured in the leverage ratio exposure measure, using the modified standardized approach for measuring counterparty credit risk exposures (SA-CCR), from January 01, 2022. This will harmonize the measurement of derivative exposures between the leverage ratio and the risk-based framework, which will improve the effectiveness of the leverage ratio as a backstop to the risk-based capital requirements
- MAS also proposes to allow banks the option to adopt the modified SA-CCR for calculation of their leverage ratio earlier than January 01, 2022, conditional on their simultaneous or prior adoption of the SA-CCR under the risk-based framework.
Comment Due Date: July 08, 2019
Effective Date: January 01, 2022 (Proposed)
Keywords: Asia Pacific, Singapore, Banking, Basel III, Credit Risk, Market Risk, Operational Risk, Output Floor, Leverage Ratio, Capital Requirements, MAS
Featured Experts
María Cañamero
Skilled market researcher; growth strategist; successful go-to-market campaign developer
Pierre-Etienne Chabanel
Brings expertise in technology and software solutions around banking regulation, whether deployed on-premises or in the cloud.
Nicolas Degruson
Works with financial institutions, regulatory experts, business analysts, product managers, and software engineers to drive regulatory solutions across the globe.
Previous Article
IFSB Consults on Guidance Note for Shariah-Compliant LOLR FacilitiesNext Article
EIOPA Updates Q&A on Regulations in May 2019Related Articles
FSB Sets Out Effective Practices for Cyber Incident Recovery
FSB finalized the toolkit of effective practices to assist financial institutions in their cyber incident response and recovery activities.
HKMA Urges Early Action for Adherence to IBOR Fallbacks Protocol
HKMA urged authorized institutions to take early action to adhere to the IBOR Fallbacks Protocol, which ISDA is expected to publish soon.
FSB Sets Out Roadmap for Transition to Alternative Reference Rates
FSB published a global transition roadmap for London Inter-bank Offered Rate (LIBOR).
HM Treasury Publishes Response to Proposal on BRRD2 Transposition
HM Treasury published a document that summarizes the responses received from a consultation on the approach of UK to transposition of the revised Bank Resolution and Recovery Directive (BRRD2).
HM Treasury Publishes Response to Proposal on CRD5 Transposition
HM Treasury published the government response to the feedback received on the consultation for updating the prudential regime of UK before the end of the Brexit transition period.
BoE Publishes Reporting Schedule for Statistical Returns
In a recent statistical notice, BoE announced publication of the reporting schedule for statistical returns for 2021.
EC Welcomes Declaration by Member States on EU Cloud Federation
EC welcomed the joint declaration by 25 EU member states on building the next generation of cloud in Europe.
MAS Amends Notice on Issuance of Covered Bonds by Banks in Singapore
MAS published amendments to Notice 648 on the issuance of covered bonds by banks incorporated in Singapore.
FDIC Selects Technology Companies for Rapid Prototyping Competition
FDIC has selected 14 technology companies—including Accenture Federal Services, LLC, Fed Reporter, Inc, and S&P Global Market Intelligence, LLC—for inclusion in the next phase of the rapid prototyping competition.
GLEIF Defines New Validation Agent Role for Financial Institutions
GLEIF announced that financial institutions worldwide can realize a variety of cost, efficiency, and customer experience benefits by assuming a new “validation agent” role within the Global Legal Entity Identifier (LEI) System.
