Pillar 3 Market Disclosures Guideline

1 | P a g e Pillar 3 Market Disclosures Guideline To enhance transparency and market discipline by financial institutions under the Financial Institutions Act, Chap. 79:09 July 2026

Pillar 3 Market Disclosures Guideline Central Bank of Trinidad & Tobago 2 | P a g e Table of Contents

1. Introduction ..................................................................................................................................................3
2. Definitions .....................................................................................................................................................4
3. Purpose, Application and Scope ................................................................................................................5
4. Disclosure Framework .................................................................................................................................6
5. Role of the Central Bank............................................................................................................................11
6. Implementation and Effective Date............................................................................................................11 Appendix 1- Table of Required Pillar 3 Disclosures.......................................................................................12

Pillar 3 Market Disclosures Guideline Central Bank of Trinidad & Tobago 3 | P a g e

1. Introduction 1.1. The Basel framework issued by the Basel Committee on Banking Supervision (“BCBS”) provides a model for enhanced capital measurement and management based on three mutually reinforcing Pillars. Pillar 1 – Minimum Capital Requirements; Pillar 2 – Supervisory Review and Evaluation Process (“SREP”) of a financial institutions’ Internal Capital Adequacy Assessment Process (ICAAP); and Pillar 3 – promotion of Market Discipline through enhanced public disclosure by financial institutions. Pillar 3 complements Pillar 1 and 2. 1.2. Specifically, Pillar 3 is designed to improve transparency, reduce information asymmetry and enhance market discipline by providing market participants with key information to assess a financial institution or banking group’s risk exposures, capital structure and adequacy, liquidity ratios and risk management practices. The guiding principles for Pillar 3 disclosures are clarity, comprehensiveness, meaningfulness/usefulness, consistency over time, and comparability. Each of these principles are discussed in turn in Section 4 of this Guideline. 1.3. Additionally, Appendix 1 summarizes the type, frequency and required format for Pillar 3 disclosures and a template is provided to assist the process. As seen in the table some disclosures have a fixed format for presenting the information and in other cases, the format is flexible. Notwithstanding the latter, a format has been provided for the flexible format for use by financial institutions should they so choose. 1.4. Regulation 7 of the Financial Institutions (Capital Adequacy) Regulations, 2020 (“Capital Regulations”) requires financial institutions to disclose such information pertaining to capital, risk exposures, risk assessment processes, credit risk mitigation and capital adequacy. In addition, Regulation 10 of the Financial Institutions (Liquidity) Regulations, 2025 (“Liquidity Regulations”) requires financial institutions to provide disclosures on liquidity risk management and liquidity risk exposures in such time, form, manner and frequency as the Central Bank may specify in a Guideline. Regulation 2 of the Capital Regulations provides for Regulation 7 to come into effect by Notice published by the Minister of Finance in the Gazette.

Pillar 3 Market Disclosures Guideline Central Bank of Trinidad & Tobago 4 | P a g e 2. Definitions Act means the Financial Institutions Act, Chap 79:09; banking group means a group that engages predominantly in banking activities such that 50% or more of the group's assets consist of banking assets or 50% or more of the group's gross income is derived from banking operations; Central Bank means the Central Bank of Trinidad and Tobago; confidential information means information that if shared with the public would cause the financial institution making the disclosure to breach the terms of a legal agreement; financial institution means a licensee or financial holding company as defined in the Act; Guideline means this “Pillar 3 Market Disclosures Guideline” issued by the Central Bank; market discipline means the disciplinary mechanism through which market forces reward financial institutions that are managed effectively while penalizing those whose management is weak or ineffective, thereby strengthening incentives for financial institutions to behave in a prudent and efficient manner; materiality means the principle whereby information would be regarded as material if its omission, non-disclosure or misstatement could change or influence the assessment or decision of a user relying on the information for the purpose of making economic decisions; non-bank financial institution/ NFI means a financial institution licensed by the Central Bank to carry on the business of a financial nature in accordance with section 17 of the Act; officer has the meaning as defined in the Act;

Pillar 3 Market Disclosures Guideline Central Bank of Trinidad & Tobago 5 | P a g e proprietary information means information, including information on products and services, which is viewed as the property of the financial institution and which, if shared with competitors, would undermine its competitive position. 3. Purpose, Application and Scope 3.1 This Guideline is made pursuant to Regulation 7 of the Financial Institutions (Capital Adequacy) Regulations, 2020 and Regulation 10 of the Financial Institutions (Liquidity) Regulations, 2025. 3.2 The purpose of this Guideline is to: 3.2.1 set out the minimum expectations of the Central Bank regarding the Pillar 3 disclosure framework to be put in place by financial institutions; 3.2.2 provide guidance to financial institutions on key information that must be disclosed, including qualitative and quantitative information; and 3.2.3 provide a consistent and comparable basis upon which Pillar 3 disclosures are to be made by financial institutions. 3.3 This Guideline applies to all licensees and financial holding companies in the following manner:- 3.3.1 On a consolidated basis to a licensee (bank1 or non-bank financial institution2 ) or domestic financial holding company of a banking group. All disclosure requirements in the Pillar 3 – Disclosures Template (“Disclosures Template”) will apply only at the top consolidated level of the relevant banking group to include all the relevant entities in the group.

1 Licensed under section 16 of the Act. 2 Licensed under section 17 of the Act.

Pillar 3 Market Disclosures Guideline Central Bank of Trinidad & Tobago 6 | P a g e 3.3.2 On an individual basis to a licensee that is a bank but which is not part of a banking group for which section 3.3.1 applies. All the disclosure requirements in the Disclosures Template will apply to the bank. 3.3.3 On an individual basis to a licensee that is an NFI but which is not part of a banking group for which section 3.3.1 applies. Based on the principle of proportionality3 , the disclosures required are the applicable disclosures in Table 1 – Key Metrics of the Disclosures Template and on an annual basis only4 , given the current size, risks and complexity of these standalone NFIs. 3.4 Notwithstanding 3.3.3 above, the Central Bank may apply additional Pillar 3 disclosure requirements to an NFI having regard to changes in the characteristics of the financial institution, including but not limited to, business model or systemic importance. Where the Central Bank so determines it will advise the NFI of this fact in writing and set out the reasons why additional disclosures should apply. 4. Disclosure Framework 4.1 Disclosure Policy 4.1.1 A financial institution should have in place a written disclosure policy which: i. is approved by its Board of Directors; ii. outlines the institution’s approach for determining the disclosure content (including the appropriateness, level of disaggregation and detail); iii. establishes sound internal controls and governance over the disclosure process including systems for the verification and review of the accuracy of information; iv. is subject to independent review (for example by the company’s internal audit function); and

3 The Principle of proportionality ensures that applicable rules and supervision practices are consistent with banks' risk profiles, systemic importance and are appropriate for the broader characteristics of a particular financial system. 4 As per section 6.2 of this Guideline, Table 1 will be implemented in Phase 2. Therefore, non-banks will only be required to commence this publication in Phase 2 of implementation.

Pillar 3 Market Disclosures Guideline Central Bank of Trinidad & Tobago 7 | P a g e v. is reviewed at least annually by the Board of Directors and senior management to ensure it is kept up to date and that the information disclosed continues to be relevant to its business model, products and current market conditions. 4.1.2 The disclosure policy of the financial institution should be proportionate to its nature, size, complexity, and risks. 4.1.3 In developing the disclosure policy, financial institutions should be guided by the following key principles:- i. Disclosures should be clear. Institutions should explain complex issues in simple language with key terms and should present information in a form that is understandable to stakeholders; ii. Disclosures should be consistent with how senior management and the board of directors assess and manage risk over time and should: a. enable stakeholders to identify trends in an institution’s risk profile across all significant aspects of its business; and b. highlight and explain additions, deletions and other important changes in disclosures from previous reports, including those arising from a specific institution or regulatory or market developments; iii. Disclosures should be comprehensive and should: a. include among other things, the main activities of the financial institution and all its significant risks, supported by relevant underlying data and information; b. describe significant changes in risk exposures between reporting periods, together with the Board / senior management’s response; c. be sufficiently flexible and provide sufficient qualitative and quantitative information to reflect how senior management and the Board internally assess and manage risks including the institution’s strategy, processes and procedures for identifying, measuring and managing those risks. The information should enable users to better understand the institution’s risk tolerance/appetite;

Pillar 3 Market Disclosures Guideline Central Bank of Trinidad & Tobago 8 | P a g e iv. Disclosures should provide meaningful or relevant information to users. Financial institutions should highlight its most significant current and emerging risks and how these risks are managed. Information likely to attract market attention, e.g. mergers and acquisitions, regulatory actions or sanctions, or material changes in the institution’s business model or strategy, should be included; v. Disclosures should be comparable across banks. The level of detail and format of presentation should enable stakeholders to perform meaningful comparisons of business activities, prudential metrics and risk management practices; 4.1.4 Financial institutions should decide what constitutes relevant disclosures based on the concept of materiality; 4.1.5 Financial institutions may omit certain disclosures if the omitted item is proprietary or confidential in nature. Where such an omission is made, the financial institution must identify the specific information that it has omitted and provide a reason for the omission in its disclosures. It should also disclose general qualitative information about the subject matter of the requirement; 4.1.6 Pillar 3 Disclosures are not required to be audited by an external auditor. However, the methodology used in preparing the disclosures must be consistent with those used for audit purposes/disclosures. In particular, the information provided by institutions under Pillar 3 must be subject, at a minimum, to the same level of internal review and internal control processes as the information provided by for their financial reporting (i.e. the level of assurance must be the same as for information provided within the management discussion and analysis part of the financial report). Information in a financial institution’s Pillar 3 disclosures should be consistent with information in its audited financial statements or regulatory returns submitted. 4.1.7 Qualitative narrative to accompany the disclosure requirements i. To provide market participants with a broader picture of its risk position and promote market discipline, institutions are expected to supplement the quantitative information provided (i.e. in both the fixed and flexible templates in the Disclosures Template) with a narrative commentary. The narrative commentary should explain at least any significant changes between reporting

Pillar 3 Market Disclosures Guideline Central Bank of Trinidad & Tobago 9 | P a g e periods and any other issues that management considers to be of interest to market participants. The form taken by this additional narrative is at the institution’s discretion. ii. Institutions may also elect to provide additional voluntary risk disclosures relevant to their business model that may not be adequately captured by the standardised requirements in the Disclosures Template. Additional quantitative information must provide sufficient meaningful information to enable market participants to understand and analyze any figures provided. It must also be accompanied by a qualitative discussion. Any additional disclosure must comply with the guiding principles above. 4.2 Location of Pillar 3 Disclosure 4.2.1 A financial institution must ensure that the Pillar 3 disclosures are easily located and accessible5 . 4.2.2 Pillar 3 disclosures should be made available on the website of the financial institution, including an archive of Pillar 3 disclosures relating to prior reporting periods. 4.2.3 Financial institutions must present their Pillar 3 disclosures in a standalone document which may be appended to, or form a discrete section of, audited financial statements. 4.2.4 Notwithstanding section 4.2.3, if the information required for any of the Pillar 3 disclosures are in the notes to the financial statements, this may be referenced or linked within the Pillar 3 document. 4.3 Frequency and Timing of Disclosure 4.3.1 In general, financial institutions are required to make their Pillar 3 disclosures on a semi-annual and annual basis, as specified, based on its financial year-end (FYE). The Tables in Appendix 1 and the Disclosures Template (published on the Central Bank’s website) specify the type and frequency of the Pillar 3 disclosures.

5 Compliance with section 4.2.2 will satisfy the requirements of section 4.2.1.

Pillar 3 Market Disclosures Guideline Central Bank of Trinidad & Tobago 10 | P a g e 4.3.2 The disclosures made by a financial institution on an annual basis should cover all the areas referred to in the Disclosures Template. Annual Pillar 3 disclosures must be based on the audited financial statements of the institution. 4.3.3 Financial institutions are required to publish their first annual Pillar 3 disclosures based on their first FYE after the date on which Regulation 7 comes into effect. An institution’s annual Pillar 3 disclosures must be published no later than two (2) months after publication of its audited financial statements for the corresponding period (i.e. five (5) months after the institution’s FYE). It should be noted however, that where a financial institution chooses to incorporate all of its annual Pillar 3 disclosures within its audited financial statements, the deadline for publication will remain as stipulated in section 80 of the Act (i.e. within three (3) months after the close of its financial year). 4.3.4 An institution’s semi-annual Pillar 3 disclosures must be published within two (2) months of the end of the relevant half-year periods, using data as at the FYE and at the mid-year (six months after the FYE). The requirement for semi-annual Pillar 3 disclosures will commence in the second fiscal year after the date on which Regulation 7 comes into effect (refer to the Timetable in the Disclosures Template). 4.3.5 Notwithstanding the frequency of reporting set out by the Central Bank, financial institutions should publish material information as soon as is practicable and not later than the deadlines established by the Central Bank. 4.3.6 Financial institutions must notify the Central Bank of the publication and location of their disclosures. 4.4 Disclosure Form and Content 4.4.1 Financial institutions should be guided by the information required to be contained in Tables 1 to 33 of the Disclosures Template when making their Pillar 3 disclosures. Except where the format is fixed, the Pillar 3 disclosure document prepared by the financial institution need not adhere to the specific tabular format in which the requirements are set out. 4.4.2 A financial institution must ensure that its Pillar 3 disclosures include an attestation from a member of the Board of Directors or a designated senior officer (e.g. Chief

Pillar 3 Market Disclosures Guideline Central Bank of Trinidad & Tobago 11 | P a g e Executive Officer, Chief Financial Officer, Chief Risk Officer) that the disclosures have been prepared in accordance with the board approved internal control process. 5. Role of the Central Bank 5.1 The Central Bank will assess the sufficiency of the Pillar 3 disclosures of financial institutions, having regard to the framework specified in this Guideline and will take the appropriate action as provided by the Guideline, the Capital Regulations, the Liquidity Regulations and the Act. 6. Implementation and Effective Date 6.1 The Central Bank proposes to implement the disclosure requirements in Phases. Phase 1 will require disclosures to be published on an annual basis only (Tables 6 – 33). Phase 2 will require additional disclosures, which must be published on a semi-annual basis (Tables 1 – 5). 6.2 This Guideline will come into effect on the date specified in the Notice published in the Gazette by the Minister of Finance. Thereafter, the Central Bank will advise licensees when the publication of the Notice has been made as well as the commencement dates of Phase 1 (annual disclosures) and Phase 2 (annual and semi-annual) disclosures. 6.3 Within three (3) months of the publication of the Notice and the issuance of the Guideline, licensees should advise the Inspector of Financial Institutions in writing, of any material information gaps or other impediments to publishing the required disclosures and inform of their plans to close the gaps in a reasonable time (e.g. 3 months). 6.4 Financial institutions are required to review this Guideline and institute appropriate measures to ensure compliance with its contents.

Pillar 3 Market Disclosures Guideline Central Bank of Trinidad & Tobago 12 | P a g e Appendix 1 Table Showing the Nature, Format and Frequency of the Pillar 3 Disclosures Tables Required to be Published Phase Table Numbers Table Name Risk Category / Description Required Format Publication Frequency* Phase 2 1 Key Metrics Overview of risk management, key prudential metrics and RWA Fixed Semi-Annual 2 Capital Structure Composition of capital Flexible Semi-Annual 3 Overview of Risk Weighted Assets Overview of risk management, key prudential metrics and RWA Fixed Semi-Annual 4 Leverage Ratio Leverage ratio Fixed Semi-Annual 5 Liquidity Coverage Ratio Liquidity Fixed Semi-Annual Phase 1 6 Scope of Application General Flexible Annual 7 Overview of Risk Management General Flexible Annual 8 Liquidity risk management Liquidity Flexible Annual 9 Differences between accounting and regulatory scopes of consolidation and mapping of financial statement categories with regulatory risk categories Linkages between financial statements and regulatory exposures Flexible Annual 10 Main sources of differences between regulatory exposure amounts and carrying values in financial statements Linkages between financial statements and regulatory exposures Flexible Annual 11 Explanations of differences between accounting and regulatory exposure amounts Linkages between financial statements and regulatory exposures Flexible Annual 12 Credit Risk - General Qualitative Information Credit risk Flexible Annual 13 Credit quality of assets Credit risk Fixed Annual 14 Changes in stock of defaulted loans and debt securities Credit risk Fixed Annual 15 Additional disclosure related to the credit quality of assets Credit risk Flexible Annual 16 Qualitative disclosure requirements related to credit risk mitigation techniques Credit risk Flexible Annual

Pillar 3 Market Disclosures Guideline Central Bank of Trinidad & Tobago 13 | P a g e Phase Table Numbers Table Name Risk Category / Description Required Format Publication Frequency* Phase 1 17 Credit risk mitigation techniques–overview Credit risk Fixed Annual 18 Qualitative disclosures on the use of external credit ratings under the standardized approach for credit risk Credit risk Flexible Annual 19 Standardized approach– credit risk exposure and credit risk mitigation (CRM) effects Credit risk Fixed Annual 20 Standardized approach - Exposures by asset classes and risk weights Credit risk Fixed Annual 21 Qualitative disclosure related to counterparty credit risk Counterparty credit risk Flexible Annual 22 Standardised Approach – Counterparty Credit Risk Exposures by Regulatory Portfolio and Risk Weights Counterparty credit risk Fixed Annual 23 Composition of collateral for Counterparty Credit Risk exposure Counterparty credit risk Flexible Annual 24 Credit Derivatives exposures Counterparty Credit risk Flexible Annual 25 Qualitative disclosure requirements related to securitization exposures Securitisation Flexible Annual 26 Securitization Exposures in the Banking book Securitisation Flexible Annual 27 Securitization exposures in the Trading book Market risk Flexible Annual 28 Qualitative disclosure requirements related to market risk Market risk Flexible Annual 29 Market Risk – standardized approach Market risk Fixed Annual 30 General qualitative information on an institution’s operational risk framework Operational risk Flexible Annual 31 Minimum operational risk capital requirement Operational risk Flexible Annual 32 Capital distribution constraints Capital distribution constraints Fixed Annual 33 Interest rate risk in the banking book (IRRBB) Interest rate risk in the banking book Flexible Annual

• Annual – using data as at the FYE Semi-annual – using data as at the FYE and Mid-Year (6 months after FYE)