Regulatory Alerts2004-01-29
Capital-Reserve Requirements for Banks as Central Securities Depository Participants in Electronic Share Transactions (STRATE)
The Office of the Registrar of Banks mandates that banks acting as Central Securities Depository Participants (CSDPs) in STRATE's electronic share transactions continue reporting their dematerialization exposures in line item 6 of form DI 110. Following the expiration of the Dispossessed Members Fund and the near-completion of the dematerialization process, these exposures are now formally categorized as operational risk and must be allocated to a nil per cent risk weighting. Banks unable to calculate specific potential exposures must report total exposure figures to facilitate regulatory monitoring ahead of the Basel II implementation, which will fully integrate these positions into operational risk capital requirements.
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