BCBS consults on framework for market discipline via regulatory disclosures

The Basel Committee on Banking Supervision has issued for consultation an updated framework for Pillar 3 disclosure requirements. Pillar 3 of the Basel framework seeks to promote market discipline through regulatory disclosure requirements. Many of the proposed disclosure requirements are related to the finalization of the Basel III post-crisis regulatory reforms in December 2017 and include new or revised requirements:

  • for credit risk (including provisions for prudential treatment of assets), operational risk, the leverage ratio and credit valuation adjustment (CVA);
  • that would benchmark a bank’s risk-weighted assets (RWA) as calculated by its internal models with RWA calculated according to the standardised approaches; and
  • that provide an overview of risk management, key prudential metrics and RWA.

In addition, today’s publication proposes new disclosure requirements on asset encumbrance and capital distribution constraints.

Separately, the Committee is seeking feedback on the scope of application of the disclosure requirement on the composition of regulatory capital that was introduced in March 2017.

Read the release

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