Capital / Liquidity

Banks are asked to strengthen loss absorption capacity, FX liquidity management, credit risk monitoring and bad debt provisioning.

The RBI also increased the cash reserve ratio, the percentage of cash that banks need to keep in reserve against their total deposits.

For 3 months, lenders may not take action against landlords who default on secured loans as a result of a rental enforcement moratorium being imposed in Hong Kong.

ISDA plans to publish a legal opinion recognising China as a jurisdiction in which close-out netting can be applied, paving the way for a more diversified onshore derivatives transactions.

The notice is aimed at facilitating the issuance of non-capital bonds with loss-absorbing capacity by Chinese D-SIBs.

Banks can include government securities worth up to 16 percent of their NDTL in their LCR calculations, compared to 15 percent under earlier guidance.

The central bank says some banks are waiving interest on loans too generously, a practice which could lead clients to lose interest in timely repayment.

The hypothetical framework would replace the current set of buffers with a "single, releasable buffer of common equity", sitting on top of a low minimum requirement.

The BSP says higher capital requirements will enable rural banks to enhance risk management, upgrade resources, and accelerate digital transformation.

The capital standard for banks’ equity investments in funds is expected to come into operation in Hong Kong on 1 July 2022.