The Bank Negara Malaysia (BNM) published the financial stability review for the first half of 2021 and issued a statement on issuance of LIBOR-referencing contracts. Globally, risk-free rates will replace LIBOR for major currencies from January 2022 onward. In line with this global development, BNM requires banks to cease new issuance of LIBOR-referencing contracts by December 31, 2021 and to reference new products against alternative rates. BNM also published an e-brochure that emphasizes the urgency for bank customers to be prepared for the transition from LIBOR to risk-free rates. It advises bank customers to ensure capacity and system readiness to transact new products in the alternative rates before December 31, 2021.
Keywords: Asia Pacific, Malaysia, Banking, LIBOR, Benchmark Reforms, Islamic Banking, Risk-Free Rates, Financial Stability, Basel, BNM
The Board of Governors of the Federal Reserve System (FED) adopted the final rule on Adjustable Interest Rate (LIBOR) Act.
The European Central Bank (ECB) published an updated list of supervised entities, a report on the supervision of less significant institutions (LSIs), a statement on macro-prudential policy.
The Hong Kong Monetary Authority (HKMA) published a circular on the prudential treatment of crypto-asset exposures, an update on the status of transition to new interest rate benchmarks.
The European Commission (EC) adopted the standards addressing supervisory reporting of risk concentrations and intra-group transactions, benchmarking of internal approaches, and authorization of credit institutions.
The China Banking and Insurance Regulatory Commission (CBIRC) issued rules to manage the risk of off-balance sheet business of commercial banks and rules on corporate governance of financial institutions.
The Hong Kong Monetary Authority (HKMA) made announcements to address sustainability issues in the financial sector.
The European Banking Authority (EBA) published regulatory standards on identification of a group of connected clients (GCC) as well as updated the lists of identified financial conglomerates.
The General Board of the European Systemic Risk Board (ESRB), at its December meeting, issued an updated risk assessment via the quarterly risk dashboard and held discussions on key policy priorities to address the systemic risks in the European Union.
The Financial Conduct Authority (FCA) is seeking comments, until December 21, 2022, on the draft guidance for firms to support existing mortgage borrowers.
The Financial Stability Board (FSB) published a report that assesses progress on the transition from the Interbank Offered Rates, or IBORs, to overnight risk-free rates as well as a report that assesses global trends in the non-bank financial intermediation (NBFI) sector.