Report sets out compliance with Basel standards

Original news:

The latest Basel Report is issued, setting out the adoption status of Basel II, Basel 2.5 and Basel III regulations for each Basel Committee member jurisdiction as of end-September 2014.

The focus of this progress report by the Bank for International Settlements is to ensure Basel standards are transformed into national law or regulation according to internationally agreed timeframes.  This report updates the committee's previous progress reports, published on a semi-annual basis since October 2011.

Background

In 2012, the Basel Committee started the Regulatory Consistency Assessment Programme to monitor progress in introducing regulations, assess their consistency and analyse regulatory outcomes. As part of this programme, the committee periodically monitors the adoption status of the risk-based capital requirements and the requirements for global and domestic systemically important banks (G-SIB/D-SIB), the liquidity coverage ratio (LCR) and the leverage ratio.

Report

The report includes tables which review members' regulatory adoption of Basel II, Basel 2.5 and Basel III, noting measures which have been adopted, are in the processing of being adopted, and those which have not been adopted. The scope includes:

  • Basel II, which was released in 2004 and was due to be implemented from year-end 2006, aimed to improve the measurement of credit risk and included capture of operational risk
  • Basel 2.5, which was due to be implemented no later than 31 December 2011, enhanced the measurements of risks related to securitisation and trading book exposures
  • Basel III, which committee members agreed to implement from 1 January 2013, set higher levels for capital requirements and introduced a new global liquidity framework
  • the G-SIB framework which will be introduced on 1 January 2016 and become fully effective on 1 January 2019
  • the D-SIB framework which comprises a set of principles on the assessment methodology and the higher loss absorbency requirement for such institutions
  • the LCR, which will be introduced on 1 January 2015, underpins the short-term resilience of a bank's liquidity risk profile
  • the Basel III leverage ratio framework and disclosure requirements, which will proceed with public disclosure starting on 1 January 2015
  • proposed revisions to the Basel framework's net stable funding ratio, with the intention this will become a minimum standard by 1 January 2018

Source: Report: Seventh progress report on adoption of the Basel regulatory framework

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