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BC work programme 2018/19

BC work programme 2018/19

The Basel Committee has published its work programme for 2018/19.

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The Basel Committee has published its work programme for 2018/19. The main message from the work programme is the shift of emphasis from policy development to consistent implementation, evaluation of consequences, monitoring emerging risks, and supervision.

Policy development

There are a limited number of policy initiatives on the table following the “finalisation of Basel 3” in December 2017. However, the Basel Committee is still working on:

  1. the final details of the revised market risk framework, which the Committee aims to finalise shortly so that regulators and banks have sufficient time to implement the framework by 1 January 2022;
  2. revisions to the global systemically important bank (G-SIB) assessment framework;
  3. the third phase of revisions to the Pillar 3 disclosure framework;
  4. potential longer-term revisions to the regulatory treatment of accounting provisions;
  5. discussing feedback on the December 2017 discussion paper on the regulatory treatment of sovereign exposures;
  6. the development of new standards on cyber risk and operational resilience; and
  7. a stocktaking exercise on current proportionality practices in jurisdictions.

The Committee will also take note of the work of the Network for Greening the Financial System (a recently established group of eight central banks and supervisors).

Implementation

The Committee continues to expect full, timely and consistent implementation of all elements of its post-crisis reforms. It will therefore continue to monitor implementation by jurisdictions and across subject areas; and to report the actions taken or planned by members to address findings identified in assessment reports.

Supervision

The Committee will continue to promote strong supervision, through a focus on (i) emerging supervisory topics that pose challenges for member authorities, including how supervisors should assess risks that may arise when banks change their business models; (ii) the supervisory oversight of risk management practices, especially in the areas of lending standards, collateral management, valuation practices and oversight of third-party origination practices; (iii) the interaction between prudential supervisory oversight and macro-prudential measures, including those relating to housing markets; (iv) continuing its review of Pillar 2 (supervisory review process) practices in member jurisdictions; (v) finalising its principles on stress-testing practices, following the consultation paper issued at the end of 2017; and (vi) a continuing emphasis on implementation of the Principles for effective risk data aggregation and risk reporting, the Principles for effective supervisory colleges, and the revised (2016) standard on interest rate risk in the banking book.

Impact of post-crisis reforms

The Committee will devote more time to evaluating and monitoring the impact of its reforms. Some of this will take the form of evaluating the impact of specific standards (for example the work in progress on the leverage ratio treatment of initial margin and its impact on client clearing), while the Committee has also set up a comprehensive work plan to monitor banks' behavioural responses to post-crisis reforms.

However, the Committee states that the purpose of any evaluation is not to re-open previous policy decisions.
 

Emerging risks

The work programme mentions here crypto-assets and the impact of fintech on supervisory and regulatory strategies.

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