BCBS FAQs on Basel III Countercyclical Capital Buffer
On October 19, 2015, the Basel Committee on Banking Supervision (BCBS) issued frequently asked questions (FAQs) on the Basel III countercyclical capital buffer (BCBS 339).
In December 2010, the BCBS published its final standards on the buffer in its paper on the Basel III regulatory framework (BCBS 189) and guidance for national authorities operating the countercyclical capital buffer (BCBS 187). The BCBS states that the FAQs provide excerpts from BCBS 187 and BCBS 189, together with clarifications, particularly on the role of jurisdictional reciprocity and the computation of the capital buffer add-on.
The BCBS has also published a dedicated website on the countercyclical capital buffer that sets out details of how member jurisdictions of the BCBS have implemented the buffer to date.
BCBS October 2015 Progress Report on Implementation of Basel Regulatory Framework
On October 15, 2015, BCBS issued its ninth progress report (BCBS 338) on BCBS members' implementation of Basel II, Basel 2.5 and Basel III, as at the end of September 2015.
The report focuses on the status of domestic rule-making processes to ensure that the Basel standards are transformed into national law or regulation according to the internationally agreed timeframes. It includes the status of adoption of the risk-based capital standards, the liquidity standards, the framework for systemically important banks, the leverage ratio, the revised Pillar 3 disclosure requirements and the large exposure framework.
EBA Updates Single Rulebook Q&As
On October 16, 2015, the European Banking Authority (EBA) updated its Q&As on the single rulebook, publishing four new questions. The single rulebook Q&As relate to the CRD IV package of reforms, namely the CRD IV Directive (2013/36/EU), the Capital Requirements Regulation (Regulation 575/2013) and the Bank Recovery and Resolution Directive (2014/59/EU).
EBA Consults on its Benchmark Rate Under the MCD
The Mortgage Credit Directive (2014/17/EU) (MCD) requires that creditors create two illustrative examples for variable rate mortgages on the basis of a benchmark rate specified by the EBA. Consequently, the EBA has developed a draft formula with which creditors are to calculate the rate. By producing a formula instead of a single rate, the EBA aims to ensure that its rate is representative of national circumstances. Annex II to the MCD sets out instructions for creditors when completing the European Standardized Information Sheet, including how to calculate the illustrative example of the annual percentage rate of charge (APR) and the illustration of the installment amount.
On October 12, 2015, the EBA published a consultation paper (EBA/CP/2015/16) on its proposed benchmark rate under the MCD. The consultation is open until November 20, 2015. The EBA intends to publish the final benchmark rate in the first quarter of 2016.
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