The Basel Committee on Banking Supervision on Friday published an outline of discussions at its meeting on 15–16 March 2018 in Basel and announced it will publish summaries of each meeting in future. “The Basel Committee is committed to transparency and accountability in its role as the global standard setter for the prudential regulation of banks,” said Stefan Ingves, Chairman of the Basel Committee and Governor of Sveriges Riksbank.
At its March meeting, the Committee discussed its work programme and strategic priorities for 2018-19. The Committee’s work programme centres on four broad themes: (i) finalising existing policy initiatives and initiating targeted policy development; (ii) ensuring full, timely and consistent implementation of the Committee’s post-crisis reforms; (iii) promoting strong supervision; and (iv) evaluating and monitoring the impact of post-crisis reforms, as well as assessing emerging risks. A revised version of the work programme, including a version for publication, will be submitted to the Committee’s oversight body, the Group of Central Bank Governors and Heads of Supervision, for endorsement.
The Committee discussed its current policy work and:
- agreed to consult on a set of limited and targeted revisions to the revised market risk framework published in January 2016. A consultation paper setting out these revisions was published on Thursday 22 March. Committee members reiterated their expectation of full, timely and consistent implementation of the revised market risk framework by 1 January 2022;
- following its consultation on possible revisions to the assessment framework for global systemically important banks, the Committee agreed on a revised framework, which will soon be published; andagreed on a set of criteria and capital treatment for short-term simple, transparent and comparable securitisations;
- the accompanying standard will be published in due course.
As part of its efforts to ensure full, timely and consistent implementation of its reforms, the Committee agreed to explore ways to conduct preliminary consistency assessments of members’ forthcoming draft rules to implement the Basel III standard, which was finalised in December 2017. The Committee agreed to commence developing a methodology for how such assessments might be conducted on the basis that such assessments would be voluntary.
The Committee also discussed its ongoing initiatives to promote strong supervision. In this context, the Committee approved a report for publication on early supervisory intervention practices.
Regulatory arbitrage
Regarding its work on evaluating and monitoring the impact of post-crisis reforms, the Committee took note of a recent stocktake of identified transactions and behavioural responses by banks that could potentially constitute a form of regulatory arbitrage. The Committee agreed to further assess a set of these transactions. As part of its regular horizon scanning, the Committee also exchanged views on recent market and supervisory developments, including the impact on the banking system of volatility in financial markets in the first quarter of 2018, and implications of the emergence of crypto-assets.
The next meeting of the Basel Committee is scheduled to take place on 19-20 September 2018.
Source: https://www.bis.org
