Regulatory AlertsRecommendation I on Foreign Exchange Risk Management in Banks and Rules for Conducting FX-Exposed Transactions
The Financial Supervision Commission issued Recommendation I to replace its 2002 predecessor, establishing strict governance and operational standards for managing foreign exchange risk in Polish banks. The document mandates that bank management and supervisory boards define risk strategies, implement internal limits, and ensure robust internal controls and reporting mechanisms. It further details specific requirements for measuring risks using methodologies like Value at Risk, managing counterparty and country risks, and adhering to liquidity and interest rate sensitivity guidelines.
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