Regulatory Alerts2024-12-13
Added · Updated
Banking (Capital)(Amendment) Rules 2023 - Supplementary Guidance on the Revised Credit Risk Framework Chapter III - STC approach
The Hong Kong Monetary Authority issues supplementary guidance clarifying due diligence requirements for Authorized Institutions under the Standardized Credit Risk Approach, mandating internal credit assessments instead of reliance on external ratings. The document details eligibility conditions for covered bonds, including specific loan-to-value ratios and cover pool composition, while providing definitions for qualifying non-bank financial institutions. It further outlines supervisory expectations for climate-related risk integration and standardizes procedures for assessing bank exposures and mapping internal credit grades to external ratings.