From the Regulators

Countries report challenges in implementing new disclosure requirements

By James Langton |

The post-crisis reform effort in the global banking sector remains a work in progress, according to a progress report published on Tuesday by the Basel Committee on Banking Supervision.

Tuesday's report on the revised regulatory framework known as Basel III shows that there's still work to be done in certain areas.

According to the report, all 27 countries reviewed in the report now have final risk-based capital rules, liquidity regulations, and capital conservation buffers in force; most have issued final rules for countercyclical capital buffers; and most countries have also issued final, or draft, rules to establish domestic systemically important banks (D-SIBs) frameworks. However, other aspects of the post-crisis reforms have not been as widely adopted.

For example, 20 countries have issued rules setting margin requirements for non-centrally cleared derivatives, the report notes, but countries have also reported challenges in implementing various reforms whose deadlines have now passed, including new disclosure requirements, and certain specific capital standards.

Countries are also starting to address other new Basel III standards that are slated to come into effect over the next couple of years, including measures related to the market risk framework, the leverage ratio and the net stable funding ratio.

In Canada, the report says that regulators are expected to publish numerous rule proposals this year, including rules for interest rate risk in the banking book, total loss absorbency requirements, and capital requirements for central counterparties (CCPs). Other rules aren't expected until 2018, including standards for minimum capital requirements for market risk.