Chapter IV of Supplementary Guidance on the Revised Credit Risk Framework

HONG KONG MONETARY AUTHORITY 香港金融管理局 Banking Policy Department Our Ref: B1/15C B9/75C S4/3C 21 July2025 The Chief Executive All Authorized Institutions Dear Sir/Madam, Chapter IV of Supplementary Guidance on the Revised Credit Risk Framework I am writing to inform you that, following consultation with the two industry Associations, the HKMA is issuing today a revised version of Chapter IV - IRB approach of the "Supplementary Guidance on the Revised Credit Risk Framework". The revised guidance primarily aims to reflect the updates to the Supervisory Policy Manual module CA-G-4 on "Validating Risk Rating Systems under the IRB Approach" gazetted on 18 July. Changes are also incorporated to clarify requirements and supervisory expectations, as well as to better align with the Basel Framework. Online access to the revised guidance is available at the HKMA's Banking Regulatory Document Repository accessible throu帥 the public website 1 or the Supervisory Communication Website 2. Should you have any questions regarding the above, please contact Mr Raymond Tsui at 2878 1623 or Mr Michael Fung at 2878 1139. Yours 魚ith魚ily, Donald Chen Executive Director (Banking Policy) Endl cc: The Chairperson, The Hong Kong Association of Banks The Chairperson, The DTC Association FSTB (Attn: Mr Timothy Wong) 'https://brdr.hkma.gov.hk/eng/fltr-rsltldoc-type/CIR 2 https:/冊rdr.stet.iclnet.hk/eng/fltr-rslt/doc-type/CIR 55th Floor. Two International Finance Centre, 8 Finance Street, Central, Hong Kong Website: www.hkrna.gov.hk 香港中環金融街8 號國際金融中心2 期55樓 網址：%vww.hknia.gov.hk