The move lowers the weighted average RRR for banks to around 7.4 percent, compared to more than 15 percent in 2018.
The RBI said the revisions will enhance the quality of financial reporting, bolster the corporate bond market, and strengthen bank risk management.
Under the new regulatory framework, the 15 upper layer NBFCs will be subject to heightened regulatory requirements for a minimum of five years.
The biggest impact for banks is expected to be from the higher risk weighting applied to equity investment positions.
Risks from customers can affect a bank’s ability to have enough liquidity in challenging markets, the FCA's Simon Walls said in a letter to bank CEOs.
China's big four banks have estimated TLAC shortfalls of around CNY 2.3 trillion based on requirements taking effect on 1 January 2025.
Prominent banking associations are demanding the release of the data and analysis to support changes to capital requirements for large banks.
Axial Capital Management failed to maintain its required liquid capital for 19 straight months and to make various filings on time.
The BCBS will prioritise work to strengthen supervisory effectiveness and analyse whether specific Basel III features performed as intended.
The amendments will remove the applicability of ARS 180.0 to non-significant financial institutions as they are smaller and less complex.
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