Capital Regulation

Locally-headquartered banks are asked to cap fiscal 2020 dividends as a pre-emptive measure to ensure sustained lending given "significant uncertainties" ahead.

Banks should retain at least half of their earnings when making capital distribution decisions, which should be informed by regular stress testing to demonstrate ongoing lending capacity.

State-owned China Reform Holdings has set up a bailout fund to help ensure SOEs can avoid bond defaults. Meanwhile, 18 provincial governments have approval to inject capital into banks.

In the past week, the central bank has sharply eased loan classification and provisioning rules, and offered credit guarantees, to try and address an unwillingness among banks to lend to small businesses.

In a 'very severe shock' scenario, 23 banks would fail to maintain the 9% capital-to-risk weighted assets ratio, and the NPA ratio would reach 14.7%.

Chairman Heath Tarbert said it is unnecessary for the CFTC to be "the world’s policeman" for all swaps, given that most G20 jurisdictions have adopted similar swaps regulations.

APRA points to physical access barriers and a high degree of uncertainty that create challenges for banks in updating commercial property valuations.

APRA will modify its capital management guidance next week to account for a 'longer-term outlook', chairman Wayne Byres said.

K Bank’s recapitalisation plan was halted last April, forcing Korea’s first internet-only bank to stop offering loan products. It is now looking to regain ground lost to Kakao Bank.

The government is looking to sell majority stakes in state-owned banks, but the plan may not be feasible this financial year due to poor market conditions and rising bad loans.