Capital Regulation

Financial holding companies controlled by non-financial enterprises that meet certain conditions will be supervised by the PBOC, with licences issued by the State Council.

By end-June 2020, all banks must provide the complete and accurate register of their shareholders to custodian institutions who will manage the register moving forward.

Macquarie, Rabobank and HSBC had provisions in group funding agreements that could allow funding to be withdrawn in a stress scenario, potentially undermining their stability.

Draft measures from the PBOC set out four types of penalties Beijing-based financial institutions must pay when their deposit reserves fall below statutory requirements.

The special inspections will reportedly involve 75 banks in 30 cities, scrutinising all aspects of property-related loans, as regulators seek to reign in risk.

RBI governor Shaktikanta Das asked state-owned banks to speed up bad debt recovery efforts, strengthen internal controls and risk monitoring, and help fix the ongoing NBFC liquidity crisis.

The revised guidance makes it easier for non-listed banks to replenish Tier 1 capital through the issuance of preferred shares. To date, only listed banks have issued such instruments.

Listed banks will have to make disclosures if the additional provisioning for NPAs assessed by RBI exceeds 10% of reported profit, compared to 15% previously.

China currently lacks smooth market exit channels, reflected in insufficient supporting measures and high exit costs for financial institutions in distress, said an NDRC spokesperson.

Under the new rules, local AMCs must price bad assets fairly and are prohibited from setting buyback terms in acquisition contracts to help financial institutions cover up bad assets.