Regulatory Alerts2019-11-15
Added · Updated
Banking (Liquidity) (Amendment) Rules 2019
The Hong Kong Monetary Authority announces that the Banking (Liquidity) (Amendment) Rules 2019 will come into operation on 1 January 2020 following the expiration of negative vetting. The amendments introduce Basel-compliant listed ordinary shares and triple-B rated marketable debt securities as level 2B and liquefiable assets for liquidity coverage and maintenance ratios. Additionally, the rules implement a required funding requirement on total derivative liabilities under the Net Stable Funding Ratio and the Core Funding Ratio.
Banking Policy Department Our Ref: B1/15C B9/155C S4/16C S4/16/1C 15 November 2019 The Chief Executive All Authorized Institutions Dear Sir / Madam, Banking (Liquidity) (Amendment) Rules 2019 Further to our letter of 28 June 2019, I write to inform you that the negative vetting by the Legislative Council of the Banking (Liquidity) (Amendment) Rules 2019 (“BLAR”) has now expired. As a result, the BLAR will come into operation on 1 January 2020. The main changes to the Banking (Liquidity) Rules are to (i) recognize Basel-compliant listed ordinary shares and triple-B rated marketable debt securities as “level 2B assets” and “liquefiable assets” under the Liquidity Coverage Ratio and the Liquidity Maintenance Ratio respectively; and (ii) implement a required funding requirement on total derivative liabilities under the Net Stable Funding Ratio and the Core Funding Ratio. Yours faithfully, Daryl Ho Executive Director (Banking Policy) cc: The Chairperson, The Hong Kong Association of Banks The Chairman, The DTC Association FSTB (Attn: Ms Eureka Cheung)
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