Office of the Comptroller of the Currency’s Post

Despite recent headlines about EU banks ditching FRTB IMA, Murex's Tim Clarsen points out in a Banking Risk & Regulation article that regional banks in Asia and Australia are moving ahead with it—they don’t face the same challenges: https://lnkd.in/einpGGAJ   However, the lack of alignment on the standards across major jurisdictions brings uncertainty for implementation timelines in that region.   Learn more.

⚔ A tug-of-war between banks and regulators over new capital rules is intensifying, with the industry pushing for a softening of how capital charges are calculated under the commonly used ‘internal model approach’. 🙅♀️ Experts say the world’s biggest banks plan to shun the IMA at scale in favour of the so-called ‘standardised approach’. This is because the cost and complexity of using it under incoming rules — the Basel IV’s Fundamental Review of the Trading Book — outweigh any capital benefit. 🤷♂️ “The assumption by the regulators was that as many banks as possible would go [for] the IMA, but the industry turned around and said: ‘Well, no, we’re going to go with the standardised approach’,” says Charlie Browne of GoldenSource. "It’s a kind of a ‘be careful what you wish for’ message from the banking industry back to the regulators.” 👇 Story by James King. Read more below. https://lnkd.in/e-n2DSfQ More insights from Tim Clarsen at Murex, Panayiotis Dionysopoulos, CFA, at ISDA and David Kelly of BIP.

We have written an article for the FT's Banking Risk and Regulation, giving our views on the regulatory outlook for the banking sector in the year ahead. You can read it below (for free!). In short: banks are spinning a fair few plates this year from a regulatory point of view. Those that are able to connect the dots – between prioritising short-term and long-term risks, between different regulatory implementation programmes and between the objectives of different stakeholders – will be best placed to prosper in the year ahead. Click below to find out more. David Strachan Suchitra Nair Rod Hardcastle

Very useful read The regulatory agenda is daunting: -new Basel rules; evolving climate risk, transition and disclosure frameworks (with the ECB driving banks particularly hard, especially around nature risks);  -heightened expectations on how banks govern model development; -EU’s Digital Operational Resilience Act. -Ongoing non-compliance by banks with BCBS 239 also serves as a cautionary example of the cost of not getting things right quickly, with the ECB set to escalate its interventions around Risk Data Aggregation and Reporting in the SREP process in 2024.

Some great detail and stats from Lloyds Banking Group in this article.

Our quarterly #Banking Regulation Review webinar is available to watch on-demand now! In case you missed the live webinar or want to revisit the insightful sessions, check the on-demand video to delve into the implementation of Basel III final rules across jurisdictions and its potential impacts. Watch on-demand: https://ow.ly/Xtsp50QU2Tb #Banks #FinancialRegulation #BaselIII

Very informative session from the ECB on striking the balance between regulation and supervision with respect to bank failures in 2023. Topics discussed include the merits of depositor protection limits and the impact of technology on the banking sector, both positive and negative. https://lnkd.in/eu_9kv9Q

Supervisory Dashboard - the evolution of key indicators since 2015 is the best proof that the Banking Union is the path to follow for a more resilient sector.

The OCC Semiannual Risk Perspective Fall 2023 report indicates the overall strength of the federal #banking system remains sound. Key risk themes highlighted include credit, liquidity, operational and compliance. Artificial intelligence in banking is discussed as an emerging risk. Read more at https://ow.ly/zG3m50Qgrmx

Have you read the latest report?