Featured Product

    Chinese Authorities Set Out TLAC Requirements for G-SIBs

    November 01, 2021

    The Chinese regulatory authorities published administrative measures on the total loss-absorbing capacity (TLAC) of global systemically important banks (G-SIBs), with these measures coming into effect on December 01, 2021. The concerned authorities are the People’s Bank of China (PBC), the China Banking and Insurance Regulatory Commission (CBIRC), and the Ministry of Finance of China. These measures are applicable to commercial banks that are incorporated in the jurisdiction of the People's Republic of China and designated by the Financial Stability Board (FSB) as G-SIBs. The key provisions of the measures cover external TLAC ratio requirements, composition of external TLAC, external TLAC deductions, supervisory review, information disclosure, and supplementary provisions.

    The term TLAC mentioned in the measures refers to the sum of capital and debt instruments of G-SIBs that can absorb losses by being written down or converted into equity in, and immediately following, a resolution. The term “external TLAC” refers to the loss-absorbing capacity that should be held by the resolution entities of G-SIBs while “internal TLAC” refers to the loss-absorbing capacity committed and allocated by the resolution entities of G-SIBs to their material sub-groups. The external TLAC ratios of a G-SIB shall be calculated pursuant to the provisions of the measures. A G-SIB shall simultaneously comply with the external TLAC requirements specified in the measures and other relevant regulatory capital requirements. A G-SIB shall disclose information on external TLAC pursuant to the provisions of the measures. A G-SIB shall disclose relevant information in accordance with the following requirements:

    • External TLAC ratios shall be disclosed on a quarterly basis
    • Information concerning, but not limited to, the amount, composition, and maturity of external TLAC shall be disclosed on a semi-annual basis
    • Other disclosure matters prescribed by PBC and CBIRC shall be disclosed regularly, as required

    Banks that have been designated as G-SIBs before January 01, 2022 shall meet the external TLAC requirements within the timeframe as specified in the measures. Banks that are identified as G-SIBs after January 01, 2022 shall meet the requirements of external TLAC within three years from the date of designation. A G-SIB that enters resolution should be allowed up to two years to meet the requirements of external TLAC again, pursuant to the measures following the date on which it exits resolution, provided that it continues to be designated as a G-SIB by FSB.

     

    Related Links (in Chinese)

    Effective Date: December 01, 2021

    Keywords: Asia Pacific, China, Banking, G-SIBs, TLAC, Disclosures, Resolution Framework, Regulatory Capital, Basel, PBC, CBIRC

    Featured Experts
    Related Articles
    News

    UK Authorities Consult on Implementation of Basel 3.1 Standards

    The UK authorities have published consultations with respect to the Basel requirements for banks. The Prudential Regulation Authority (PRA) published the consultation paper CP16/22 on rules for the implementation of Basel 3.1 standards.

    November 30, 2022 WebPage Regulatory News
    News

    ESAs Issue Multiple Regulatory Updates for Financial Sector Entities

    The three European Supervisory Authorities (ESAs) issued a letter to inform about delay in the Sustainable Finance Disclosure Regulation (SFDR) mandate, along with a Call for Evidence on greenwashing practices.

    November 15, 2022 WebPage Regulatory News
    News

    FSB and NGFS Publish Initial Findings from Climate Scenario Analyses

    The Financial Stability Board (FSB) and the Network for Greening the Financial System (NGFS) published a joint report that outlines the initial findings from climate scenario analyses undertaken by financial authorities to assess climate-related financial risks.

    November 15, 2022 WebPage Regulatory News
    News

    FSB Issues Reports on NBFI and Liquidity in Government Bonds

    The Financial Stability Board (FSB) published a letter intended for the G20 leaders, highlighting the work that it will undertake under the Indian G20 Presidency in 2023 to strengthen resilience of the financial system.

    November 14, 2022 WebPage Regulatory News
    News

    ISSB Makes Announcements at COP27; IASB to Propose IFRS 9 Amendments

    The International Sustainability Standards Board (ISSB) of the IFRS Foundations made several announcements at COP27 and with respect to its work on the sustainability standards.

    November 10, 2022 WebPage Regulatory News
    News

    IOSCO Prioritizes Green Disclosures, Greenwashing, and Carbon Markets

    The International Organization for Securities Commissions (IOSCO), at COP27, outlined the regulatory priorities for sustainability disclosures, mitigation of greenwashing, and promotion of integrity in carbon markets.

    November 09, 2022 WebPage Regulatory News
    News

    EBA Finalizes Methodology for Stress Tests, Issues Other Updates

    The European Banking Authority (EBA) issued a statement in the context of COP27, clarified the operationalization of intermediate EU parent undertakings (IPUs) of third-country groups

    November 09, 2022 WebPage Regulatory News
    News

    EU Finalizes Rules Under Crowdfunding Service Providers Regulation

    The European Union has finalized and published, in the Official Journal of the European Union, a set of 13 Delegated and Implementing Regulations applicable to the European crowdfunding service providers.

    November 08, 2022 WebPage Regulatory News
    News

    OSFI Sets Out Work Priorities and Reporting Updates for Banks

    The Office of the Superintendent of Financial Institutions (OSFI) published an annual report on its activities, a report on forward-looking work.

    November 07, 2022 WebPage Regulatory News
    News

    APRA Finalizes Changes to Capital Framework, Issues Other Updates

    The Australian Prudential Regulation Authority (APRA) finalized amendments to the capital framework, announced a review of the prudential framework for groups.

    November 03, 2022 WebPage Regulatory News
    RESULTS 1 - 10 OF 8597