Bank regulators Friday issued a revised version of their capital adequacy guidelines, and an advisory updating public disclosure requirements for banks.
The Office of the Superintendent of Financial Institutions (OSFI) issued an advisory that aims to clarify the implementation of new disclosure requirements adopted by the Basel Committee on Banking Supervision, which revised its rules on the information banks must publicly disclose when detailing the composition of their capital as part of the new Basel III regime.
The Basel Committee’s rules aim to establish a framework to ensure that banks, which are subject to Basel III, publicly disclose the components of their capital bases in standardized formats both between, and within, jurisdictions. In Canada, this includes all banks, bank holding companies, federally regulated trust and loan companies, and cooperative retail associations, regardless of size or whether they are public companies.
OSFI says that its guidance in this area has been revised to reflect changes to the disclosure required as a result of OSFI’s recent decision to begin phasing in the Credit Valuation Adjustment (CVA) capital charge starting January 1, 2014, and ending on December 31, 2018; and to provide minor clarifications to address questions that the regulator has received in this area.
OSFI also issued an amended version of the capital adequacy requirements guideline that incorporates a number of clarifications, which are effective immediately, “to facilitate the interpretation of guidance in a number of chapters and to revise incorrect paragraph cross-references included in the previous version”.