Regulatory Alerts2020-06-04
Added · Updated
Circular to Credit and Financial Institutions on amendments to Banking Rule BR/14
Banking Rule BR/14 on Outsourcing by Credit Institutions is wholly revised to implement EBA Guidelines on Outsourcing Arrangements and introduce a notification procedure for material outsourcing under Article 19A(1) of the Banking Act. Credit institutions must notify the Authority at least 60 days prior to conferring an outsourcing activity by submitting specified information, and are obliged to assess risks, conduct due diligence on service providers, and document an exit strategy. The revised Rule establishes that all requirements are subject to the principle of proportionality based on the credit organization and the nature of its activities. Financial institutions are guided to verify that their outsourcing agreements meet the requisites of BR/14, and the rule comes into force with immediate effect.
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