HKMA revised completion instructions for the Return of Loans and Advances and Provisions (MA(BS)2A) and the Return of Mainland Activities (MA(BS)20), consequential to the implementation of Part 7 of the Banking (Exposure Limits) Rules (BELR). Taking into account the six-month grace period allowed for compliance with Part 7 of the BELR, authorized institutions should start applying the revised completion instructions to report these two returns no later than the position of March 2020. An authorized institution that is capable of starting earlier may choose to do so.
The sole changes to these two returns concern aligning the meaning of “group of linked counterparties” with the BELR by referring to the same term under the new Large Exposures Return (MA(BS)28). HKMA believes that such minor changes should not cause reporting difficulties. The two returns cover the following information:
- Form MA(BS)2A is a quarterly return that analyzes, by economic sector, an authorized institution's loans and advances for use in Hong Kong. It also analyzes the performance of an institution's selected assets (mainly loans and advances) and off-balance sheet exposures according to the classification methods defined in these instructions. Information on provisions set aside for each category of classified assets is also included. Specific provisions and general provisions mentioned in this completion instruction should follow the definitions of specific provisions and collective provisions defined in section 2(1) of the Banking (Capital) Rules respectively.
- Form MA(BS)20 is a quarterly return that collects information on the Mainland-related business activities of authorized institutions and their Mainland bank subsidiaries. The scope of reporting covers activities booked in the Hong Kong office(s), Mainland branch(es), and subsidiary bank(s) in Mainland China. Specific provisions and general provisions mentioned in the completion instructions should follow the definitions of specific provisions and collective provisions as defined in section 2(1) of the Banking (Capital) Rules, respectively.
Keywords: Asia Pacific, Hong Kong, Banking, Large Exposures, MA (BS) 2A, MA (BS) 20, Instructions, Reporting, BELR, Banking Capital Rules, HKMA
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