Regulatory Alerts2012-09-29
SAMA Consultative Draft on Basel II.5 Implementation (Standardized and IRB Approaches)
The Saudi Arabian Monetary Authority (SAMA) issued this consultative draft to implement Basel II.5, establishing standardized and internal ratings-based (IRB) capital adequacy frameworks alongside Pillar 2 ICAAP and Pillar 3 disclosure requirements. All domestic banks must submit comments by 10 October 2012, while foreign bank branches will coordinate directly with SAMA and their home supervisory authorities regarding capital adequacy planning. The finalized framework takes effect on 1 January 2013, with the first quarterly prudential returns due by 30 April 2013 covering data as of 31 March 2013.
• Banking Supervision Dept. It should be noted that these Prudential Returns are not applicable to branches of foreign banks as the Agency will discuss the Basie II implementation with their Head Offices and Home Supervisory Authorities, and ensure that they include the branches in Saudi Arabia in their Capital Adequacy plans. B. Pillar 2 • Basel 11.5 Pillar 2 ICAAP Requirements
- Please refer to P. 40 C. Pillar 3 • Basel 11.5 Pillar 3 Disclosure Requirements
- Please refer to P. 42 All banks are expected to review this package and provide comments to SAMA by 10 October 2012, as this exercise will assist in finalizing this package. SAMA will issue its Finalized Basel 11.5 Guidance Document before 31 December 2012. Consequently, SAMA Basel 11.5 Framework will be effective 1 January 2013. Banks will submit their first quarterly prudential returns for data as of 31 March 2013 to be sent to SAMA by 30 April 2013. ;f 9------\ -&-if-¼, Abdulrahman A. Al-Kalaf Deputy Governor for Technical Affairs 3 P. 0. Box 2992 - Riyadh 11169, Saudi Arabia - Tel.: 01-463 3000 - Telex 404390 SJ - Fax 01-466 2119