Prudential Risk

Capital Adequacy

BCBS Reorganises Standards in Consolidated “Basel Framework”

By Editors | 11/04/2019

The consolidated Basel Framework has been published initially in draft form, together with a consultative document on technical amendments to the standards.

Clearing & Post-Trade

Close-Out Netting Essential for Asia Derivatives Markets – ISDA

By Manesh Samtani | 11/04/2019

Close-out netting is the single most effective tool for reducing credit risk between counterparties, says ISDA chief Scott O’Malia, highlighting the ambiguity over its treatment in key jurisdictions.

Emerging Prudential Risks

BigTechs Contribute to Efficiency – and Risk – in Financial Services

By Manesh Samtani | 08/04/2019

A BIS working paper says BigTechs enhance competition, financial inclusion and efficiency in financial services, but they also concentrate market power and give rise to systemic risk.

Market Risk

RBI Defers Mandatory Pegging of Loan Rates to External Benchmarks

By Editors | 08/04/2019

The RBI has deferred a requirement for banks to link loan rates to external benchmarks, citing difficulties the change presents to banks’ interest rate risk management.

Capital Adequacy

Fitch Warns of Downgrade Amid RBNZ Bank Capital Review

By Manesh Samtani | 08/04/2019

Fitch Ratings says its assessment of New Zealand’s largest banks could change if capital requirements become so onerous as to cause their Australian parents to divest.

Credit Risk

China’s Henan Province Has an NPL Problem – Report

By Editors | 08/04/2019

Of Henan’s 93 commercial banks, 42 have high levels of nonperforming loans, a dozen of which reported an NPL ratio above 20%, ‘several’ as high as 40%.

Clearing & Post-Trade

Supervisors Should Avoid Fragmenting Clearing Ecosystem – Report

By Editors | 07/04/2019

A report from the World Federation of Exchanges and Oliver Wyman urges supervisors to ensure outstanding CCP reforms are implemented in line with agreed principles to avoid fragmentation.

Capital Adequacy

Sectoral CCyB May be Useful Addition to Existing Tools – BCBS Paper

By Editors | 05/04/2019

Sectoral CCyBs increase banking system resilience at a lower cost than the Basel III CCyB, and can serve to reduce excessive credit growth and risks in targeted segments.

Credit Risk

SFC Finalises Guidelines on Securities Margin Lending

By Editors | 05/04/2019

The guidelines will take effect in October, requiring brokers to limit margin lending to five times their capital, among other controls to reduce excessive leverage.