Featured Product

    IFSB Consults on Revised Capital Adequacy Standard for Islamic Banks

    November 04, 2019

    IFSB published an exposure draft on the revised capital adequacy standard for institutions offering Islamic banking services. The aim of exposure draft is to align the IFSB capital adequacy standard (IFSB-15) with global capital standards, particularly the Basel III final reforms. The comment period for the exposure draft ends on January 02, 2020. IFSB invites comments from central banks, regulatory and supervisory authorities, international organizations, institutions offering Islamic financial services, academics, and other interested parties. The enhancements to credit, market, and operational risk frameworks, as well as the leverage ratio framework, should be implemented by January 01, 2022.

    The enhancements to the components of capital, capital conservation buffer (CCB), countercyclical capital buffers (CCyB), and Islamic windows operations are expected to be implemented immediately by the regulatory and supervisory authorities in their jurisdictions. Regulatory and supervisory authorities may consider earlier implementation timelines wherever feasible, taking into account an adequate period for the transposition of the standard into national supervisory regulations and guidelines for institutions offering Islamic financial services. The revised standard provides enhanced guidance to the regulatory and supervisory authorities, along with the necessary flexibility for its application across regions, and to the small to fairly large and sophisticated institutions offering Islamic financial services. The main objectives of the standard include the following:

    • Assist the institutions offering Islamic financial services and their supervisory authorities in the implementation of a capital adequacy framework that will ensure effective coverage of risk exposures of the institutions and allocation of appropriate capital to cover these risks, thus enhancing the resilience of the the Islamic financial services industry
    • Provide enhanced guidance on the maintenance of high-quality regulatory capital components by the institutions offering Islamic financial services, which comply with Sharī`ah rules and principles
    • Enhance the guidance provided by the earlier IFSB capital adequacy standards in addressing the capital adequacy requirements of various risk exposures related to Sharī`ah-compliant products and services offered by the institutions offering Islamic financial services
    • Provide enhanced guidance on the capital adequacy treatment of an institution's involvement in Sukūk issuance and securitization processes in various capacities
    • Address specific concerns in the course of implementation of the earlier IFSB capital adequacy standards and guidance notes
    • Adapt international best practices, as well as current and emerging standards, relating to the capital adequacy for the institutions offering Islamic financial services

     

    Related Links

    Comment Due Date: January 02, 2020

    Keywords: International, Banking, Capital Adequacy, Basel III, Islamic Banking, Securitization, IFSB 15, IFSB

    Featured Experts
    Related Articles
    News

    EBA Clarifies Use of COVID-19-Impacted Data for IRB Credit Risk Models

    The European Banking Authority (EBA) published four draft principles to support supervisory efforts in assessing the representativeness of COVID-19-impacted data for banks using the internal ratings based (IRB) credit risk models.

    June 21, 2022 WebPage Regulatory News
    News

    BIS Hub Updates Work Program for 2022, Announces New Projects

    The Bank for International Settlements (BIS) Innovation Hub updated its work program, announcing a set of projects across various centers.

    June 17, 2022 WebPage Regulatory News
    News

    US Senate Members Seek Details on SEC Proposed Climate Disclosure Rule

    Certain members of the U.S. Senate Committee on Banking, Housing, and Urban Affairs issued a letter to the Securities and Exchange Commission (SEC)

    June 16, 2022 WebPage Regulatory News
    News

    EIOPA Consults on Review of Securitization Framework in Solvency II

    The European Insurance and Occupational Pensions Authority (EIOPA) published a consultation paper on the advice on the review of the securitization prudential framework in Solvency II.

    June 16, 2022 WebPage Regulatory News
    News

    UK Authorities Issue Regulatory and Reporting Updates for Banks

    The Prudential Regulation Authority (PRA) issued a statement on PRA buffer adjustment while the Bank of England (BoE) published a notice on the statistical reporting requirements for banks.

    June 15, 2022 WebPage Regulatory News
    News

    BaFin Consults on Resolvability Requirements for Resolution Planning

    The Federal Financial Supervisory Authority of Germany (BaFin) proposed to amend the “Capital Investment Conduct And Organization Ordinance” and issued a draft circular on the minimum resolvability requirements for resolution planning.

    June 10, 2022 WebPage Regulatory News
    News

    EBA Consults on Certain Standards and Guidelines Under CRR and BRRD

    The European Banking Authority (EBA) proposed guidelines, for the resolution authorities, on the publication of the write-down and conversion and bail-in exchange mechanic, with the comment period ending on September 07, 2022.

    June 08, 2022 WebPage Regulatory News
    News

    OJK Publishes Regulatory Updates for Financial Sector Entities

    The Financial Services Authority of Indonesia (OJK) is strengthening cooperation with the Australian Prudential Regulation Authority (APRA) and the Japanese Financial Services Agency (JFSA)

    June 03, 2022 WebPage Regulatory News
    News

    EU Publishes Rules on DLT and Data Governance

    The European Parliament and the Council published Regulation 2022/868 on European data governance (Data Governance Act).

    June 03, 2022 WebPage Regulatory News
    News

    EBA Publishes Phase 2 of Reporting Framework 3.2

    The European Banking Authority (EBA) published phase 2 of its reporting framework 3.2. The technical package supports the implementation of the updated reporting framework by providing standard specifications

    June 03, 2022 WebPage Regulatory News
    RESULTS 1 - 10 OF 8267