29 November 2018

BIS: International supervisory community meets to discuss challenges ahead for global bank supervision and regulation

At the Basel Committee's meeting on 26-27 November, the Committee:

• agreed to a set of targeted revisions to the market risk framework, which will be submitted to the Basel Committee's governing body, the Group of Central Bank Governors and Heads of Supervision (GHOS). The revised framework seeks to enhance the risk sensitivity of the standardised approach, revise the calibration of certain elements of the framework, and improve certain aspects of the internal models approach. If endorsed by the GHOS, the framework would be published in early 2019;
• agreed to consult on potential enhanced disclosures to reduce bank window-dressing behaviour related to the leverage ratio;
• approved a set of revisions to the Pillar 3 disclosure framework, which will be published in December; and
• reviewed a report setting out the range of bank, regulatory and supervisory cyber-resilience practices across jurisdictions. This report will be published in December.

The Committee discussed its ongoing evaluation of its post-crisis reforms, including the usability of capital buffers; members reaffirmed the usefulness of buffers as a loss-absorbing mechanism. The Committee took note of the comments received on its discussion paper on the regulatory treatment of sovereign exposures. The Committee also discussed its work programme and strategic priorities for 2019; it expects to publish the work programme in early 2019, following review and endorsement by GHOS.

The Committee agreed to consult next year on a framework which would consolidate the Committee's standards into a single integrated framework.

The ICBS, which was hosted by the Central Bank of the United Arab Emirates, took place on 28-29 November. As the ICBS coincided with the 10th anniversary of the global financial crisis, delegates discussed the evolution of the regulatory landscape over the past decade and the implications for regulation and supervision.

Discussions at the ICBS included best practices for evaluating the impact of post-crisis reforms, the role of proportionality in the Basel framework, and the importance of implementing the post-crisis reforms in a full, timely and consistent manner. Looking forward, participants exchanged views on the supervisory challenges following the completion of Basel III, the implications of financial technology for banks and supervisors, and the importance of strengthening operational resilience, including cyber-resilience.

Press release

Conference programme

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