US
Office of the Comptroller of the Currency (OCC) Issued Federal Register (2024-07950) Proposing Revised Data Collection on Liquidity Coverage Ratio (LCR) Data
The OCC is soliciting comment concerning a revision to its information collection, ‘‘Reporting and Recordkeeping Requirements Associated with Liquidity Coverage Ratio: Liquidity Risk Measurement, Standards, and Monitoring.’’ The U.S. Banking Agencies (FRB, FDIC & OCC) implemented a quantitative liquidity requirement inlcusive of the liquidity coverage ratio (LCR) and the net stable funding ratio (NSFR), applicable to certain large banking organizations. The LCR is designed to promote the short-term resilience of the liquidity risk profile of covered banking organizations and promote the measurement and management of liquidity risk. Comments must be received by 6/17/2024.
Global
Financial Stability Board (FSB) Issued Consultation on Non-Bank Financial Institutions (NBFI) Liquidity Preparedness
The FSB issued a consultation report on proposals to enhance liquidity preparedness of non-bank financial institution (NBFI) market participants for market and collateral calls. It sets out eight policy recommendations re: margin/collateral calls in centrally and non-centrally cleared derivatives and securities markets. The report highlights the need for policy adjustments to deal with liquidity strains in the NBFI sector. The recommendations are proposed to apply prortionately with focus on NBFI participants with material exposures to spikes in margin and collateral calls during times of stress. The FSB invites responses to be submitted by 6/18/2024.
The Bank of International Settlements (BIS) Basel Committee Issues Discussion Paper on Climate Risk Scenario Analysis (ESG)
The Basel Committee issued a Discussion Paper, “The Role of Climate Scenario Analysis (CSA) in Strengthening the Management and Supervision of Climate-Related Financial Risks”, examining the objectives of CSA exercises. Supervisors were also encouraged to determine whether banks were applying CSA, but differences in CSA exercise scope and feature approaches across jurisdictions and banks limit harmonization of supervisory expectations and the comparability of results. This paper is seeking feedback in conjunction with work of the Financial Stability Board (FSB) and the Network for Greening the Financial System (NGFS). Stakeholder feedback is invited until 7/15/2024.
The Bank of International Settlements (BIS) Basel Committee Issues Working Paper on "Finternet": Future Financial System
The Basel Committee issued a Working Paper, “Finternet: the Financial System for the Future”. The paper proposes the concept of the Finternet as a vision for the future financial system: multiple financial ecosystems interconnected with each other, much like the internet. It provides a blueprint for how key technical characteristics such as interoperability, privacy, and verifiability can be incorporated, and how varied governance norms can be embedded. Leveraging tokenization and introduction of unified ledgers would improve existing financial transactions, but also make entirely new financial products and transactions possible.