Regulatory Alerts2024-06-03
Added · Updated
Circular to Credit Institutions on the Update to Banking Rule BR/18 on the Risk-Based Method and the Compensation Contribution Method under the Depositor Compensation Scheme Regulations
Banking Rule BR/18 is amended to implement the European Banking Authority’s revised Guidelines on methods for calculating contributions to deposit guarantee schemes. The updated rule introduces the Net Stable Funding ratio, updates the Risk Weighted Assets ratio numerator to Total Risk Exposure Amount, inverts the Unencumbered assets/Covered deposits ratio, adjusts indicator weights, and modifies the formulas for the Individual Risk Score and Aggregate Risk Weight. Requirements generally come into force on 3 July 2024, with the second batch of contributions for 2024 based on the current rule and the updated rule becoming applicable from 1 January 2025.
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