Regulatory Alerts2023-09-28
BS8 Connected Exposures Policy - October 2023
The Reserve Bank of New Zealand issued this revised policy to regulate registered banks' credit exposures to connected persons, aiming to mitigate conflict of interest risks and ensure financial system stability. The document mandates that aggregate exposures remain within rating-contingent limits relative to Tier 1 capital and prohibits transactions on terms more favorable than those offered to non-connected persons. It further establishes strict governance requirements and detailed measurement methodologies for calculating exposure values, including specific rules for credit risk mitigation and trading book positions.
Share