Recent regulatory publications from various global jurisdictions have introduced a series of updates and consultations aimed at enhancing the effectiveness, compliance, and transparency of financial regulations.
This blog endeavours to provide actionable insights to help organizations achieve regulatory compliance and maintain resilient operations.
Business Line | Country | Regulator | Rule/ Regulation | Summary |
All | Panama | Prevenciondelavado | The April 2024 Private Sector Consultative Forum (PSCF) of the Financial Action Task Force (FATF) convened over 250 representatives from diverse sectors, emphasizing the crucial collaboration between public and private entities in combatting money laundering and terrorist financing. Held in Vienna, Austria, and organized by the UN Office on Drugs and Crime (UNODC), the forum highlighted the alignment of FATF’s strategic priorities with the evolving risk landscape, emphasizing the roles of the private sector and civil society in enhancing anti-money laundering and counter-terrorist financing (AML/CFT) efforts. Discussions covered key topics such as payment transparency, asset recovery, and the impact of digitalization and innovation on financial crime. The event underscored the necessity of global cooperation in addressing financial threats and informed future FATF initiatives, to be discussed further at the upcoming plenary meeting in Singapore in June 2024. | |
Global | IFRS | The Sustainability Consultative Committee (SCC) convened in April 2024 to review and contribute to the International Sustainability Standards Board’s (ISSB) forthcoming work plan, which aims to address stakeholder feedback and outline next steps for implementation. Following a Request for Information (RFI) in June 2023 and subsequent deliberations, the ISSB received 433 responses, primarily from investors, expressing strong support for activities such as supporting the implementation of IFRS S1 and S2 and enhancing SASB Standards. Key priorities identified include addressing risks and opportunities related to biodiversity, ecosystems, and human capital, with emphasis on interoperability and collaboration with existing frameworks like the Global Reporting Initiative (GRI) and European Sustainability Reporting Standards (ESRS). The ISSB plans to finalize the work plan in the first half of 2024, focusing on connectivity, stakeholder engagement, and advancing sustainability reporting standards. | ||
Global | Cloud Security Alliance | CPPA AI Rules Cast Wide Net for Automated Decision-making Regulation | The California Privacy Protection Agency (CPPA) has introduced draft regulations aimed at regulating automated decision-making technology (ADMT), including artificial intelligence (AI), to strengthen consumer privacy protections in the state. These regulations encompass various technologies utilizing computation to make decisions, with a focus on profiling individuals based on personal information. Key elements of the draft rules include requirements for businesses to provide pre-use notice detailing the purpose and process of ADMT, as well as the right for consumers to opt out of decisions with significant effects. Recent updates to the draft rules include specific provisions for various profiling scenarios and expanded rights for consumers, such as access to information and post-use notices for adverse decisions. These regulations have significant implications for employers, who must inform job applicants and employees about ADMT usage in employment decisions and conduct risk assessments to mitigate privacy risks. While the draft regulations demonstrate California’s proactive stance on regulating ADMT and protecting consumer privacy, they are subject to further modification pending public feedback and the formal rulemaking process. | |
Malta | MFSA | The Malta Financial Services Authority (MFSA) issues a circular updating stakeholder on the ongoing public consultation by the European Supervisory Authorities (ESAs) regarding the harmonization of conditions enabling oversight activities under Regulation (EU) 2022/2554 on Digital Operational Resilience for the Financial Sector. The ESAs are seeking feedback on a draft Regulatory Technical Standard (RTS) focusing on the composition of joint examination teams for the Oversight Framework established by the regulation. Stakeholders, including financial entities, are invited to provide comments through links provided on the ESAs’ websites, with a submission deadline of May 18, 2024. Further information can be obtained by contacting the Supervisory ICT Risk and Cybersecurity function via email. | ||
United Kingdom | GOV.UK | The Insolvency Service has developed a revisions policy in accordance with section ‘T3.9’ of the Code of Practice for Statistics, outlining procedures for scheduled revisions and unscheduled corrections to published statistics. Scheduled revisions involve planned amendments to improve data quality by incorporating additional information, while unscheduled corrections address errors identified after initial publication. The policy emphasizes transparency and clarity in explaining the scale, nature, cause, and impact of revisions or corrections alongside the statistics. Revisions are typically marked in data tables and explained in relevant workbooks or methodology notes. The policy aims to provide timely and accurate data while ensuring transparency and accountability in the revision process, with major revisions stemming from factors like legislative changes or methodological updates. | ||
Guernsey | GFSC | On April 25th, 2024, the Commission issued an updated Handbook on Countering Financial Crime (AML/CFT/CPF), incorporating several revisions and technical changes aimed at enhancing anti-money laundering and counter-terrorist financing measures. Chapter 1 now provides guidance to licensed firms regarding offences under specific sections of the Criminal Justice (Proceeds of Crime) Law and Terrorism and Crime Law. Minor technical adjustments include amendments to Schedule 3 of the Criminal Justice Law related to customer due diligence measures, disclosure requirements for trustees, and thresholds for occasional transactions involving virtual assets. Changes to ordinances governing wire transfers aim to align with FATF Recommendations, while updated rules within the Handbook emphasize the importance of identifying and verifying legal entities and arrangements, reporting suspicious transactions, and monitoring compliance of agents in AML/CFT/CPF programmes. The updated Handbook, along with corresponding rules and guidance, is available for reference on the Handbook page. | ||
United Kingdom | FCA | FG24/3: Finalised non-handbook guidance on the anti-greenwashing rule | The April 2024 Finalised Guidance FG24/3 provides non-handbook guidance on the Anti-Greenwashing Rule. This rule is part of a comprehensive package of measures established through the Policy Statement on Sustainability Disclosure Requirements and investment labels. It addresses the significant consumer interest in sustainable products and services and the associated risk of greenwashing—where claims about sustainability may be exaggerated or misleading. The rule mandates that sustainability-related claims be fair, clear, and not misleading to protect consumers and ensure a level playing field for firms genuinely offering sustainable products. The guidance helps firms understand and implement this rule by clarifying expectations, providing examples, and addressing feedback from industry stakeholders. It also supports the Financial Conduct Authority’s (FCA) strategic objective of making markets function well by enhancing the transparency and integrity of the market for sustainable finance. | |
United Kingdom | FCA | The Financial Conduct Authority (FCA) has issued a consultation paper (CP24/9) regarding proposed updates to the Financial Crime Guide (The Guide) aiming to enhance understanding and effectiveness of financial crime systems and controls within regulated firms. The consultation addresses areas such as sanctions, proliferation financing, transaction monitoring, crypto assets, and the Consumer Duty, while also proposing consequential changes to ensure relevance and accuracy. The FCA emphasizes the importance of firms’ self-assessment and judgment in implementing proportionate controls and invites feedback from relevant stakeholders to inform future updates and ensure the Guide’s ongoing clarity and relevance. Comments on the proposed changes are welcomed until June 27, 2024, with plans to publish feedback and the final amended Guide in a subsequent Policy Statement. | ||
United States | IRS | IRS releases final guidance on transfers of certain credits under the Inflation Reduction Act | The Department of Treasury and the Internal Revenue Service (IRS) have released final regulations detailing the rules and definitions for the transfer of eligible credits under the Inflation Reduction Act and the Creating Helpful Incentives to Produce Semiconductors act (CHIPs). These regulations allow taxpayers to transfer certain manufacturing investment, clean energy investment, and production tax credits to unrelated taxpayers for cash payments. Effective for tax years beginning after Dec. 31, 2022, eligible taxpayers can elect to transfer credits, with the unrelated taxpayers then able to claim them on their tax returns. The final regulations also outline special rules for excessive credit transfers and recapture events, along with a mandatory IRS pre-filing registration process and specific guidelines for partnerships and S corporations. Detailed instructions on the pre-filing registration process and updated FAQs are available on the IRS website. | |
European Union | European Union | The legislative resolution P9_TA(2024)0350 adopted by the European Parliament on April 24, 2024, addresses the enhancement of public capital markets in the EU, specifically aiming to make these markets more attractive for companies and facilitate easier access to capital for small and medium-sized enterprises (SMEs). The resolution proposes amendments to Regulations (EU) 2017/1129, (EU) No 596/2014, and (EU) No 600/2014, emphasizing the need for a regulatory framework that supports easier access to equity funding for companies, including SMEs. It highlights the role of the Capital Markets Union (CMU) in reducing market fragmentation and supporting company growth through diversified financing options. The amendments aim to decrease regulatory burdens for issuers on SME growth markets, streamline access to capital, and ensure that SMEs can transition effectively into larger capital markets over time. | ||
United Kingdom | ICO | The guidance provides an overview of the data protection principles under the UK GDPR, emphasizing their importance in all sectors. It outlines the seven key principles, including lawfulness, fairness, transparency, purpose limitation, data minimisation, accuracy, storage limitation, integrity, confidentiality, and accountability. Compliance with these principles is crucial for ensuring good data protection practices and avoiding substantial fines for non-compliance. Additionally, the guidance offers resources such as a records management self-assessment checklist and training videos to support organizations in implementing these principles effectively. | ||
European Union | European Parliament | The European Parliament has approved new measures aimed at strengthening the EU’s ability to combat money laundering and terrorist financing. The package includes provisions for increased transparency, granting access to beneficial ownership information to various stakeholders, including journalists and civil society organizations. Additionally, the laws introduce enhanced due diligence requirements for financial institutions and extend these measures to professional football clubs from 2029. A new supervisory authority, the Authority for Anti-Money Laundering and Countering the Financing of Terrorism (AMLA), will be established in Frankfurt to oversee the implementation of these rules and intervene in cases of supervisory failures. The legislation, which consists of the sixth Anti-Money Laundering directive, a single rulebook regulation, and the AMLA regulation, still requires formal adoption by the Council before publication in the EU’s Official Journal. | ||
Luxembourg | CSSF | CSSF through the Circular CSSF 24/857 announces the integration of the latest version of the ESMA Guidelines on stress test scenarios under the Money Market Fund (MMF) Regulation into the administrative practices of the CSSF. All money market funds (MMFs) under the supervision of the CSSF and Luxembourg managers of MMFs are required to comply with these 2023 Guidelines. The update includes changes to the methodology for implementing stress test scenarios, particularly focusing on the level of liquidity changes and the calibration of risk parameters. These changes aim to reflect prevailing systemic risks identified for the EU financial system as of November 2023. Additionally, the Circular specifies the entry into force of the updated Guidelines on 6 May 2024 and mandates their application for MMF reporting starting from 30 June 2024 onwards. | ||
Canada | PRIV | The Office of the Privacy Commissioner of Canada (OPC) submitted feedback to Justice Canada regarding the Second Additional Protocol to the Budapest Convention, highlighting concerns about privacy risks and legal implications. They emphasized the importance of judicial oversight for access to subscriber information and raised questions about the alignment of proposed provisions with Canadian jurisprudence. The OPC recommended opting out of direct request provisions, ensuring robust safeguards for data access, and aligning implementation with established data protection principles. They also addressed jurisdictional variances in privacy enforcement and emphasized the need for consistency and interoperability to facilitate effective collaboration. Overall, the OPC encouraged prioritizing initiatives for modernizing privacy legislation to meet evolving challenges. | ||
Luxembourg | MFIN | Minister of Finance Gilles Roth announced a comprehensive 10-point action plan for sustainable finance at the Luxembourg Sustainable Finance Forum. The plan aims to strengthen Luxembourg’s position as a hub for sustainable finance and mobilize private capital for sustainability efforts over the next five years. It includes priorities such as developing innovative solutions for global impact investments, supporting talent development, and promoting innovation and digitalization in sustainable finance. Minister Roth emphasized the importance of going beyond green initiatives to include biodiversity, gender finance, and broader social and governance aspects. He highlighted the role of finance in driving positive change and urged swift collective action to close the funding gap for achieving the UN Sustainable Development Goals by 2030 and transitioning to net-zero emissions. The Ministry of Finance will work with both public and private stakeholders to implement the plan’s initiatives in the coming months and years. | ||
British Virgin Islands | BVIFSC | The BVI Financial Services Commission is seeking public feedback on proposed reforms to the BVI Business Companies Act through the Draft BVI Business Companies (Amendment) Act, 2024. The explanatory memorandum provides context for the reforms, emphasizing the need for completeness in reviewing the bill and addressing practical implementation challenges. Key reforms are driven by various factors including recommendations from the BVI Mutual Evaluation Report, revisions related to FATF Recommendation 24, feedback from industry partners, and issues identified by the Registrar and the Commission. The proposed amendments primarily focus on enhancing transparency, compliance, and penalties, including measures regarding nominee shareholders and directors, uniform filing of registers, information collection, cooperation with authorities, and penalty structures. The bill also introduces transitional provisions for existing companies and those previously struck off and dissolved. The Commission emphasizes the importance of submitting feedback before the deadline of 6:00 pm on Monday, 6 May 2024. | ||
United States | California DFPI | DFPI Reports Expanded Enforcement, Awareness Under CA Consumer Financial Protection Law | The Department of Financial Protection and Innovation (DFPI) has issued its 2023 report, showcasing significant advancements in investigations, public actions, and consumer outreach efforts under the California Consumer Financial Protection Law (CCFPL). Led by Commissioner Clothilde V. Hewlett, the DFPI experienced a 70 percent increase in CCFPL-related consumer complaints, with crypto assets and debt collectors being the top two areas of concern. The report highlights the launch of the Crypto Scam Tracker, a web-based tool aiding Californians in identifying and avoiding crypto-related scams. Additionally, the DFPI implemented a new consumer complaints portal to enhance complaint management and data quality. Notably, the report underscores progress in rulemaking, including enhanced protections for small businesses and new registration requirements for various financial products and services. Through statewide multilingual campaigns and outreach events, the DFPI reached thousands of consumers, reinforcing its commitment to consumer protection and responsible financial innovation. | |
United Kingdom | RCIS | The Royal Institution of Chartered Surveyors (RICS) has initiated a consultation on the proposed updated Continuing Professional Development (CPD) Framework, aimed at enhancing support for members and bolstering public confidence in the profession. Established in February 2023, the CPD Framework Steering Group has undertaken a comprehensive review process, incorporating feedback from members and stakeholders to draft revisions that prioritize meaningful CPD engagement and self-reflection among RICS professionals. Drawing on insights from global frameworks and historical feedback, the consultation seeks to gather further input to refine the final recommendations before submission to RICS’ Standards and Regulation Board for approval in late 2024, with implementation scheduled for January 2026. | ||
Global | FSB | The revised “Guidance on Financial Resources to Support CCP Resolution and on the Treatment of CCP Equity in Resolution” issued on April 25, 2024, provides crucial support for resolution authorities in assessing the adequacy of financial resources for central counterparty (CCP) resolution and handling CCP equity in resolution scenarios. Originally published in November 2020, this updated version incorporates the Financial Stability Board’s toolbox approach to financial resources and tools for resolving systemically important central counterparties. Divided into two parts, the guidance outlines five steps to evaluate a CCP’s financial resources and potential stability implications, emphasizing cooperation with oversight and supervisory authorities. Additionally, it provides a framework for assessing CCP equity exposure to losses and potential adjustments in resolution scenarios, contributing to robust resolution planning and financial stability. | ||
British Virgin Islands | BVIFSC | The BVI Financial Services Commission has released Industry Circular 10 of 2024 announcing the publication of new articles related to anti-money laundering (AML) efforts. One article discusses the launch of the Commission’s 2024/25 Inspection Plan, which focuses on mitigating ML, TF, and PF risks identified through risk assessments and regulatory activities. Thematic inspections, desk-based reviews, and targeted meetings will be conducted, primarily focusing on sectors such as Trust and Corporate Services Providers (TCSPs) and Investment Business (IB) due to their higher risk profiles. Another article presents initial findings from thematic inspections on Third Party relationships, providing recommendations for compliance with statutory requirements. These articles and more can be accessed on the Commission’s dedicated AML-related articles section on their website. | ||
Banks | Italy | BancadItalia | Consultation on Systemic Risk Buffer: Summary of Feedback and Assessments | The Bank of Italy recently concluded a consultation process initiated on March 8, 2024, regarding the activation of a Systemic Risk Buffer (SyRB). The consultation, which ended on March 29, 2024, received feedback from various stakeholders, including the Italian Banking Association (ABI) and individual respondents. In summary, the Bank of Italy’s evaluations align with the feedback received, highlighting the well-capitalized nature of banks in Italy and emphasizing the SyRB’s role in preserving excess capital within the banking system. The document also addresses observations and evaluations related to the establishment, release, level definition, and application scope of the SyRB, emphasizing its contribution to enhancing the resilience of the banking system. Additionally, it discusses the macroprudential regulatory framework’s evolution and clarifies the interaction between the SyRB and the non-distributable reserve introduced by Law No. 136/2023. |
Germany | BaFin | BaFin Issues Circular on Reporting Risks in Payment Transactions under PSD2/ZAG | BaFin has released Circular 05/2024 (BA) on April 26, 2024, outlining the reporting requirements for payment service providers in accordance with Section 53 Paragraph 2 of the Payment Services Supervision Act (ZAG). As per the Second Payment Services Directive 2 (PSD2) and ZAG, payment service providers are mandated to report operational and security-related risks to the supervisory authority and evaluate the adequacy of their risk mitigation measures. The circular introduces a standardized form for reporting, which must be submitted annually by December 31st and sent to BaFin via email within two months of the deadline. | |
European Union | European Union | The European Parliament’s legislative resolution from April 24, 2024, amends Regulation (EU) No 575/2013 concerning the prudential requirements for credit institutions. This amendment aims to refine the requirements for credit risk, credit valuation adjustment risk, operational risk, market risk, and the output floor. It responds to the persistent challenges highlighted by the global financial crisis, aiming to integrate the Basel III reforms and ensure a balanced capital requirement landscape that doesn’t significantly hike overall capital needs for the EU banking sector. The amendment seeks to enhance the resilience of the banking sector, adjust risk sensitivity, and maintain competitive equity without escalating capital demands across the board. This legislative move underscores the EU’s commitment to aligning its banking regulations with international standards while considering the specific needs of the EU financial market. | ||
United Kingdom | BOE | The Bank of England has released the final Codes of Practice (CoPs), guidance, and Wholesale Cash Distribution (WCD) Data Catalogue following a consultation conducted in November 2023. The consultation sought feedback on various aspects of the proposed CoPs for WCD market oversight, including information gathering, third-party arrangements, cash center closure, and market exit. Seven stakeholders responded, with the majority expressing support for the proposed regime while providing constructive feedback. The Bank considered all responses and has addressed relevant issues raised, with the finalized documents coming into effect for recognized firms upon their recognition by HMT under wholesale cash oversight orders. Any issues not directly related to the consultation will be addressed with the respective respondents in regular meetings. | ||
Spain | Bank of Spain | Global Banking Supervision Conference Highlights Evolving Regulatory Landscape | The 23rd International Conference of Banking Supervisors (ICBS) recently convened in Basel, Switzerland, bringing together over 220 central bankers and banking supervisors from around the world. Hosted by the Basel Committee on Banking Supervision, the conference commemorated the Committee’s 50th anniversary and addressed the future of global bank supervision amidst emerging risks and structural changes. Key discussions centred on endorsing the revised Core Principles for effective banking supervision, consulting on guidelines for enhancing banks’ counterparty credit risk management and publishing an analytical report on the digitalization of finance. Emphasizing cross-border cooperation and the importance of implementing Basel III standards, the ICBS underscored the need for robust regulatory frameworks to ensure financial stability in an interconnected global financial system. | |
Jersey | JFSC | Jersey Proposes Basel III Alignment with “Quick Wins” Consultation Paper | Jersey’s financial regulatory body has released a new consultation paper outlining proposed changes to align the local regulatory regime with the Basel III Framework, following feedback received in 2021. The proposals include aligning capital minima with Basel standards, introducing a capital conservation buffer, expanding eligible securities for High-Quality Liquid Assets, and updating concession limits for Public Sector Entities. While certain aspects such as “systemic importance, leverage ratio, trading book, market risk, counterparty credit risk, and the NSFR” are not currently being pursued, they are outlined in the Basel III prudential roadmap. Feedback on the proposals is invited until June 30, 2024, with plans to implement changes by January 1, 2025. Detailed documents and guidance notes are available on Jersey’s Basel III page for review. | |
European Union | EBA | The European Banking Authority (EBA) has launched a consultation paper seeking feedback on proposed Regulatory Technical Standards (RTS) regarding the method for identifying the main risk driver of a position and determining whether a transaction represents a long or a short position. The consultation paper outlines amendments to the Capital Requirements Regulation (CRR), particularly focusing on calculating capital requirements for market and counterparty credit risks. Specific attention is given to clarifying the notions of long and short positions, as well as the aggregation mechanism in the calculation process. The proposed methodology involves utilizing sensitivities and add-ons, aligned with the Fundamental Review of the Trading Book (FRTB) and the Standardized Approach for Counterparty Credit Risk (SA-CCR). Small banks are provided with a simplified method covering various financial instruments. Feedback on the consultation paper is encouraged until July 24, 2024, after which the EBA will revise the draft RTS based on received feedback and submit them to the European Commission for adoption. | ||
United Kingdom | PSR | The Payment Systems Regulator (PSR) has initiated a call for views on its proposed approach to supervision following the establishment of its Supervision and Compliance Monitoring division last year. Aimed at enhancing compliance with PSR requirements, the division focuses on fostering competition, expanding choice, and combating payment fraud within the industry. Through regular engagement and evidence-based supervision, the PSR aims to cultivate effective, ongoing relationships with regulated firms, particularly payment system operators like Pay.UK, Visa, and Mastercard. The proposed principles aim to set regulatory expectations flexibly, tailored to individual firms’ aims and needs. Supervision will play a crucial role in assessing policy impacts and horizon scanning efforts, while collaboration with other regulatory bodies will streamline activities and enhance regulatory efficiency. The call for views closes on June 7, 2024. Additional insights from Oliver Hanmer are available through a video and thought piece shared by the PSR. | ||
European Union | European Union | New EU Regulation Enhances Standardized Assessment of Interest Rate Risks in Banking Sector | The Commission Delegated Regulation (EU) 2024/857, effective from April 24, 2024, supplements Directive 2013/36/EU by introducing standardized and simplified methodologies for assessing interest rate risks in banks’ non-trading book activities. This regulation aims to harmonize the evaluation of risks affecting both the economic value of equity and net interest income, ensuring that institutions maintain stability against potential fluctuations in interest rates. The methodologies provided are grounded in previous guidelines and standards from the European Banking Authority and Basel Committee and include detailed procedures for the slotting of cash flows and calculations regarding options and automatic options. This update is crucial for banks to adequately prepare for and mitigate risks arising from interest rate changes, enhancing financial stability within the European Union. | |
Hong Kong | HKMA | HKMA Seeks Industry Consultation on Updated Credit Risk Framework | The Hong Kong Monetary Authority (HKMA) issued a letter on April 22, 2024, to consult the banking industry on updated and expanded supplementary guidance reflecting the revised credit risk framework under the Banking (Capital)(Amendment) Rules 2023. These questions and answers (Q&As) aim to provide clarity and assistance to authorized institutions (AIs) regarding the implementation of certain sections of the Banking (Capital) Rules (BCR). The Q&As are designed in simple language to aid understanding but do not substitute for reading the BCR themselves. They cover consultation and rule-making processes, common inquiries, developments in the Basel Framework, and relevant guidance from the Basel Committee on Banking Supervision (BCBS). AIs are encouraged to seek legal or professional advice for any specific matters not covered in the Q&As or if they have doubts about the application of the BCR to their circumstances. | |
South Africa | Reserve bank | The South African Reserve Bank (SARB) issued a letter dated April 22, 2024, regarding a Proposed Guidance Note under section 6(5) of the Banks Act 94 of 1990. The note aims to offer additional guidance to banks, branches of foreign institutions, and controlling companies concerning the completion and submission of quarterly operational risk forms BA 410 and BA 420, ensuring consistency in operational risk reporting across banks. The guidance emphasizes adherence to regulatory requirements and specifies submission deadlines for the forms BA 410 and BA 420. It delineates reporting criteria for operational risk losses, provides thresholds for reporting material losses, and sets out provisions for internal operational risk management. The proposed guidance note is expected to replace the existing Guidance Note 11 of 2022 upon finalization. It is effective from the implementation date of the proposed amended Regulations, scheduled for July 1, 2025. | ||
South Africa | Reserve bank | The South African Reserve Bank (SARB) has issued a Proposed Guidance Note under section 6(5) of the Banks Act 94 of 1990, offering detailed guidance to banks, controlling companies, and branches of foreign institutions on the interpretation and completion of the 6-monthly operational risk form BA 400. The note outlines the purpose of form BA 400 in relation to capital and reserve funds for operational risk, as specified in the proposed amended Regulations, and provides clear instructions for its completion. Scheduled to be effective from 1 July 2025, this guidance aims to ensure consistency in operational risk reporting across banks and enhance regulatory compliance in the South African banking sector. | ||
Insurance | United Kingdom | BOE | CP5/24 – Review of Solvency II: Restatement of assimilated law | The Prudential Regulation Authority (PRA) has issued CP5/24, the final consultation paper aimed at implementing the conclusions of the Solvency II Review and finalizing PRA rules and policy materials to replace Solvency II assimilated law. This consultation represents a significant step in aligning the UK’s prudential regime for insurers with its approach to financial services regulation. The CP proposes restating Solvency II requirements into PRA policy material, aiming to provide clarity and coherence to prudential requirements for insurers. It builds upon previous consultations, including reforms to Solvency II and restatements of assimilated law. The proposed reforms aim to streamline regulations and remove cross-references to the EU’s prudential framework, ultimately benefiting the UK insurance sector. |
Hong Kong | HKIA | Consultation conclusions on draft Rules on Risk-based Capital regime | The Insurance Authority (IA) has released the consultation conclusions on six draft Rules for the implementation of the Risk-based Capital (RBC) regime, marking a significant step in enhancing regulatory standards within the insurance sector. Following public consultation, stakeholders expressed general support for the proposals, with feedback primarily focused on capital requirements and asset-liability valuation. After careful consideration of the responses, the IA has adjusted certain original proposals. The finalized Rules, including provisions covering exemptions to actuary appointments, valuation and capital requirements, submission of statements, maintenance of assets, regulations for marine and captive insurers, and rules for Lloyd’s, are slated for tabling at the Legislative Council for negative vetting in May 2024. This aligns with the expected commencement of the Insurance (Amendment) Ordinance 2023, signalling a concerted effort towards bolstering regulatory efficacy in the insurance industry. | |
Investment | New Zealand | FMA | The Liquidity Risk Management Guide issued by the Financial Markets Authority (FMA) serves as a comprehensive resource for managers and supervisors of managed investment schemes, outlining the importance of effectively managing liquidity risk in line with statutory obligations. With the aim of promoting fair, efficient, and transparent markets, the guide emphasizes the critical role of managed funds in financial markets and the need to ensure investors can withdraw or transfer their investments in a timely manner without negatively impacting market stability. The guide underscores the legal requirement for managers and supervisors to exercise care, diligence, and skill, and to act in the best interests of scheme participants, highlighting the importance of having robust liquidity risk management policies, processes, and tools in place to meet regulatory standards and ensure equitable treatment of investors. | |
United Kingdom | FCA | The Consultation Paper (CP) outlines proposals to extend the Sustainability Disclosure Requirements (SDR) and investment labels regime to portfolio management services, building upon previous measures introduced for fund managers. The aim is to enhance consumer protection, improve market trust in sustainable investments, and bolster the UK’s position as a competitive centre for sustainable finance. The proposed extension encompasses various forms of portfolio management services, including model portfolios and bespoke management, primarily targeting retail investors but also allowing professional clients to opt into the labelling regime. The desired outcomes include minimized greenwashing, increased provision of standardized sustainability information, and enhanced consumer trust and market integrity. The success of these proposals will be measured through supervision processes, consumer feedback, monitoring for signs of greenwashing, and a post-implementation review after three years. The consultation closes on June 14, 2024, with final rules expected to be published in the second half of 2024. |
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