Regulatory Alerts2011-11-10
Enhancements to the ICAAP Document at End of 2011
The Banking Supervision Department requires banks to submit specific year-end 2011 data to enhance their Internal Capital Adequacy Assessment Process. Institutions must report connected party loan concentrations, Liquidity Coverage and Net Stable Funding Ratios alongside three-year deposit breakdowns, plus currency-specific derivatives activity and current leverage ratios. These updated reporting requirements ensure a more comprehensive assessment of capital adequacy and liquidity risk across the banking sector.
... $aubi �rabian ;fflonetarp §gencp Banking Supervision Dept. • Number of loans extended to connected parties and the total value of such loans as a percentage of total credit. • Total value of loans to connected parties as a percentage of total regulatory capital. • The banks could add comments on the concentration risk and how it affects their assessment of additional capital requirements, if any. 3. Liquidity Risk: The Banks should provide the following information as at the end of year 2011. • Liquidity Coverage Ratio • Net Stable Funding Ratio In addition, the following information should be provided for the past three years (as at end of the year): • Deposits from top ( 10) ten customer as a percentage of total customer deposits. • Deposits from Wholesale markets (interbank, others) as a percentage of total liabilities. 4. Off Balance Sheet Activities: The following year-end information on Derivatives Activity should be provided for past 3 years with breakdown in Saudi Riyal, USO and other currencies. • Interest rate Derivatives • FX Derivatives • Total 5. Capital Leverage Ratio: Banks should include information on the following: ■ Basie Capital Leverage Ratio ( current year) • Legal Leverage Ratio under the Banking Control Law (for past 3 years) The Agency will continue to enhance the ICAAP process to make it more comprehensive and meaningful. q \ Dr. Abdulrahman Al Kalaf Deputy Governor for Technical Affairs 2 P. 0. Box 2992 - Riyadh 11169, Saudi Arabia - Tel.: 0 1-463 3000 - Telex 404390 SJ - Fax 01-466 2119