Final capital disclosure norms by May-end

The Reserve Bank on Friday said the final guidelines on capital disclosure requirements will come out by the month-end and the capital requirements for banks’ exposures to central counterparties (depositories) under the tighter Basel III norms will be issued by June-end.

“It has been proposed to issue the final guidelines on composition of capital disclosure requirements by end May, and the final guidelines on capital requirements for banks’ exposures to central counterparties by the end of June,” RBI Governor D Subbarao announced while unveiling the bank’s annual monetary policy.
After a three-months delay, the Basel III capital regulation norms kicked in from April 1 with the exception of credit valuation adjustment (CVA) risk capital charge for OTC derivatives.

Pending resolution of certain issues related to the introduction of the mandatory forex forward guaranteed settlement through a central counterparty, the implementation of the CVA risk capital charge has been deferred to January 1.

On the guidelines on liquidity coverage ratio and liquidity risk monitoring tools under the Basel III framework, the RBI said liquidity standards included liquidity coverage ratio (LCR), net stable funding ratio (NSFR) and liquidity risk monitoring tools.
The central bank had issued draft guidelines on liquidity risk management and Basel III framework on liquidity standards in February 2012 after taking into account the feedback from stakeholders.

The stakeholder feedback included enhanced guidance on liquidity risk governance and measurement, monitoring and reporting to the Reserve Bank on liquidity positions.

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