Most Basel members not yet factoring climate change into prudential capital frameworks

In a survey, the Basel Committee on Banking Supervision found that most of its members prefer to address climate-related financial risks within their existing regulatory and supervisory frameworks, but there is still much work to be done.

Xavier Larrieu

Supervisors urge IFRS-9 forward provisioning flexibility to save capital

The Covid-19 pandemic is not only taking monetary and fiscal policy into new territory, but is also having an impact on how banks provision for bad loans under IFRS-9 accounting standards  

EBA agrees with changes to risk weight standards for specialised lending

Amendments to standards on risk weights for specialised lending exposures made by the European Commission have found approval with the European Banking Authority (EBA), which will endorse them.

Moody’s warns of growing vulnerability of banks as Covid crisis deepens

Though the economic shock from the Covid-19 pandemic has not led to immediate changes in the underlying credit strength of banks, many will become increasingly vulnerable as the crisis draws on, warned Moody’s Investors Service. 

Fitch Ratings to ignore ECL capital waiver for rating banks

Fitch Ratings said it will continue to consider EU banks' IFRS-9 expected credit losses (ECLs) alongside headline reported common equity Tier 1 (CET1) ratios, when rating their capital strength. 

Fed extends dates for parts of credit limit rule by 18 months

The US Federal Reserve has extended by 18 months initial compliance dates for parts of the single-counterparty credit limit rule. 

EBA publishes final FRTB RTSs to smooth implementation

The final draft on regulatory technical standards (RTS) has been published on the new internal model approach (IMA) under the Fundamental Review of the Trading Book (FRTB), by the European Banking Authority (EBA) to smooth its implementation. 

Tim Clark

Timing of SCB buffer questioned by critics

The introduction of the new stress capital buffer in the US is poorly timed, according to critics, as it permanently relaxes capital standards, potentially making US banks more vulnerable to economic shocks

Agencies give banks CECL accounting relief on forward provisioning

The three prudential federal regulators told banks they can delay the forward provisioning element of the current expected credit loss (CECL) accounting standard for two years due to the economic impact of the Covid-19 pandemic. 

Michael McKee web

Global regulatory banking reforms face first major test

The economic fallout from the coronavirus pandemic is the first major test of the reformed Basel framework. But with more stress to come will it prove resilient and is it likely to be revised again once the crisis passes?