CBIRC and PBC Publish Regulations for Systemically Important Banks
The China Banking and Insurance Regulatory Commission (CBIRC) and the People's Bank of China (PBC) have published additional regulations on systemically important banks, which shall come into force on December 01, 2021. The key provisions included in the regulations cover additional regulatory requirements, recovery and resolution planning, and prudential supervision. CBIRC published a set of questions and answers on these additional regulations as well as the list of nineteen banks of systemic importance.
The regulations clarify the requirements for additional regulatory indicators, including additional capital and additional leverage ratios. According to the regulations, systemically important banks have been divided into five groups. Banks in the first to fifth groups are subject to additional capital requirements of 0.25%, 0.5%, 0.75%, 1%, and 1.5%, respectively. The additional leverage ratio requirement is 50% of the additional capital requirement of systemically important banks. The regulations also clarify the requirements for recovery and resolution planning. Systemically important banks shall formulate group-level recovery and resolution plans and submit them, for review, to the crisis management team led by PBC. The regulations clarify the requirements for prudential supervision, including information related to reporting and disclosure, risk data aggregation and risk reporting, and corporate governance requirements.
Additionally, CBIRC and PBC have released the list of domestic systemically important banks (D-SIBs) in China and have identified nineteen systemically important banks in China based on 2020 data. These nineteen systemically important banks include six state-owned commercial banks, nine joint-stock commercial banks, and four city commercial banks. CBIRC and PBC have divided these banks in five groups:
- First group includes Ping An Bank, China Everbright Bank, Hua Xia Bank, China Guangfa Bank, Bank of Ningbo, Bank of Shanghai, Bank of Jiangsu, and Bank of Beijing
- Second group includes Shanghai Pudong Development Bank, China CITIC Bank, China Minsheng Bank, and China Postal Savings Bank
- Third group includes Bank of Communications, China Merchants Bank, and Industrial Bank
- Fourth group includes the Industrial and Commercial Bank of China, Bank of China, China Construction Bank, and Agricultural Bank of China
- No banks have entered the fifth group
Related Links (in Chinese)
- Press Release on Additional Regulations
- Additional Regulations
- Q&A on Additional Regulations
- Press Release on List of D-SIBs
Effective Date: December 01, 2021
Keywords: Asia Pacific, China, Banking, Regulatory Capital, Leverage Ratio, Resolution Framework, D-SIBs, Resolution Planning, Basel, Systemic Risk, PBC, CBIRC
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
Related Articles
BSP Tackles Aspects of Lending and Islamic, Open & Sustainable Finance
The Central Bank of the Philippines (BSP) issued communications covering developments related to online lending platforms, open finance framework and roadmap, and on the expected regulations in the area sustainable finance.
US Agencies Issue Regulatory Updates, FDIC Launches Tech Sprint
The Board of Governors of the Federal Reserve System (FED) published the final rule that amends Regulation I to reduce the quarterly reporting burden for member banks by automating the application process for adjusting their subscriptions to the Federal Reserve Bank capital stock, except in the context of mergers.
EBA Issues Guide on Bank Resolvability, Consults on Transferability
The European Banking Authority (EBA) published its assessment of risks through the quarterly Risk Dashboard and the results of the Autumn edition of the Risk Assessment Questionnaire (RAQ).
MFSA Publishes CRD5 Updates and Supervisory Priorities for 2022
The Malta Financial Services Authority (MFSA) updated the guidelines on supervisory reporting requirements under the reporting framework 3.0.
HKMA Extends Repayment for Trade Facilities, Consults on Crypto-Assets
The Hong Kong Monetary Authority (HKMA) published a circular, along with the reporting form and instructions, for self-assessment, by authorized institutions, of compliance with the Code of Banking Practice 2021.
FCA Registers Securitization Repositories; PRA Issues 2022 Priorities
The Financial Conduct Authority (FCA) decided to register European DataWarehouse Ltd and SecRep Limited as securitization repositories under the UK Securitization Regulation, with effect from January 17, 2022.
EC Regulation Sets Out Methods for Measuring K-Factors Under IFR
The European Commission (EC) published the Delegated Regulation 2022/25, which supplements the Investment Firms Regulation (IFR or Regulation 2019/2033) with respect to the regulatory technical standards specifying the methods for measuring the K-factors referred to in Article 15 of the IFR.
BIS Studies How Platform Models Impact Financial Stability & Inclusion
The Bank of International Settlements (BIS) published a paper that assesses the ways in which platform-based business models can affect financial inclusion, competition, financial stability and consumer protection.
CBE Issues Additional Measures to Ease Disruptions from Pandemic
The Central Bank of Egypt (CBE) published a circular with instructions on emergency liquidity assistance to banks that are unable to meet their liquidity requirements.
ESAs Publish List of Financial Conglomerates for 2021
The European Supervisory Authorities (ESAs) published the list of identified financial conglomerates for 2021.
