FINMA published guidance (06/2020) on extending or discontinuing various exemptions that were granted due to the COVID-19 crisis. The guidance also offers additional details on the handling of duration for loans procured as part of the SNB COVID-19 refinancing facility (CRF) for calculating the net stable funding ratio (NSFR).
Clients continue to hold unusually large deposits with Swiss banks. Therefore, FINMA is extending the exemption for the calculation of the leverage ratio (exclusion of central bank reserves) for all banks until January 01, 2021 (from July 01, 2020). In case of dividend distributions, the reduction in the relief described in FINMA Supervisory Notice 03/2020 continues to apply. FINMA does not plan to continue with this treatment as a temporary relief after this extension of the deadline. Also, relief in the area of risk diversification will not continue due to lack of demand and will end on July 01, 2020. However, institutions can request specific exemptions in individual cases. The exemption concerning market risks is to be incorporated into future supervisory practice. Additionally, exemptions granted by FINMA in the area of anti-money laundering, for the opening of new client relationships, will be extended for specific situations, in particular for foreign clients, to return gradually to the normal opening procedure.
Keywords: Europe, Switzerland, Banking, COVID-19, Leverage Ratio, NSFR, Dividend Distribution, Credit Risk, Market Risk, FINMA
Leading economist; commercial real estate; performance forecasting, econometric infrastructure; data modeling; credit risk modeling; portfolio assessment; custom commercial real estate analysis; thought leader.
Previous ArticleEIOPA Changes Frequency of RFR and EDA Processes to Two Weeks
APRA issued a letter on the loss-absorbing capacity (LAC) requirements for domestic systemically important banks (D-SIBs) and published a discussion paper, along with the proposed the prudential standards on financial contingency planning (CPS 190) and resolution planning (CPS 900).
The European Commission (EC) launched a call for evidence, until March 18, 2022, as part of a comprehensive review of the macro-prudential rules for the banking sector under the Capital Requirements Regulation (CRR) and Directive (CRD IV).
The Financial Stability Board (FSB) published a report that sets out good practices for crisis management groups.
The Australian Prudential Regulation Authority (APRA) found that Heritage Bank Limited had incorrectly reported capital because of weaknesses in operational risk and compliance frameworks, although the bank did not breach minimum prudential capital ratios at any point and remains well-capitalized.
The Office of the Superintendent of Financial Institutions (OSFI) released the annual report for 2020-2021.
Through a letter addressed to the banking sector entities, the Office of the Superintendent of Financial Institutions (OSFI) announced deferral of the domestic implementation of the final Basel III reforms from the first to the second quarter of 2023.
EIOPA recently published a letter in which EC is informing the European Parliament and Council that it could not adopt the set of draft regulatory technical standards for disclosures under the Sustainable Finance Disclosure Regulation (SFDR) within the stipulated three-month period, given their length and technical detail.
The Financial Conduct Authority (FCA) published the third in a series of policy statements that set out rules to introduce the UK Investment Firm Prudential Regime (IFPR), which will take effect on January 01, 2022.
The Australian Prudential Regulation Authority (APRA) published, along with a summary of its response to the consultation feedback, an information paper that summarizes the finalized capital framework that is in line with the internationally agreed Basel III requirements for banks.
The Committee on Payments and Market Infrastructures (CPMI) and the International Organization of Securities Commissions (IOSCO) issued a consultative report focusing on access to central counterparty (CCP) clearing and client-position portability.