Basel Committee launches consultation on G-SIB assessment
21 July 2021 Switzerland
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The Basel Committee on Banking Supervision (BCBS) has launched a consultation regarding a proposed technical amendment to the assessment methodology for globally systemically-important banks (G-SIBs).
The Committee currently evaluates the systemic importance of global banks every three years using an indicator-based methodology.
It plans to replace this with an ongoing monitoring and review process. This will take into account any important developments in monitoring tools or indicators that can be used to measure and monitor systemic risk.
It will also evaluate ongoing evidence available to the BCBS regarding the effectiveness of the G-SIB regime in monitoring systemic risk, along with any structural changes that may affect this monitoring process.
The Committee says that it will only consider changes to the regime when its monitoring work reveals material unintended consequences or material deficiencies in the framework’s objectives.
Given that the current Basel framework is based on the existing three-year cycle, a technical amendment is required to reflect the changes that the Committee has proposed.
Comments on the proposed amendment must be submitted by 3 September 2021.
The Committee currently evaluates the systemic importance of global banks every three years using an indicator-based methodology.
It plans to replace this with an ongoing monitoring and review process. This will take into account any important developments in monitoring tools or indicators that can be used to measure and monitor systemic risk.
It will also evaluate ongoing evidence available to the BCBS regarding the effectiveness of the G-SIB regime in monitoring systemic risk, along with any structural changes that may affect this monitoring process.
The Committee says that it will only consider changes to the regime when its monitoring work reveals material unintended consequences or material deficiencies in the framework’s objectives.
Given that the current Basel framework is based on the existing three-year cycle, a technical amendment is required to reflect the changes that the Committee has proposed.
Comments on the proposed amendment must be submitted by 3 September 2021.
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