Basel III implementation – update and a roadmap for liquidity standards

Background

Basel III is an internationally agreed set of measures and standards developed and issued by the international standard setting body, the Basel Committee on Banking Supervision (Basel Committee).  It expanded upon and replaced Basel II.  The various Basel III reforms were brought together into one consolidated set of standards, collectively referred to as the Basel Framework. 

Implementation of the components of the Basel Framework continues to progress internationally, and the Isle of Man Financial Services Authority is committed to meeting international standards where it is appropriate and proportionate to do so. 

 

We have to take into account that many of our banks are part of large international banking groups that are subject to consolidated supervision in countries that have, or are moving towards, Basel III implementation.  At the same time, implementation of reforms in the Island needs to be suitable and effective for the profile of the sector.

 

We have updated our Basel III webpage to help explain our approach to implementation and to set out the core components of the Basel Framework.

 

Updating the liquidity framework

We have already implemented several elements of the Basel III reforms, including a framework for domestic systemically important banks, requirements for better quality and levels of capital, and reporting of the leverage ratio (a non-risk-based capital ratio). 

 

Although further reforms to capital adequacy will need to be considered, implementing the Basel III liquidity reforms is a key priority for the Authority to help maintain an effective regulatory and supervisory framework and to continue to provide adequate protection for consumers.

 

We have therefore set out today a roadmap for the implementation of the Basel III liquidity standards in the Isle of Man and look forward to working with the sector to bring these changes into operation.

 

Enquiries

 

Prudential Supervision Division:

 

Andrew Kermode

Head of Division

T: +44 (0)1624 689320

E: andrew.kermode@iomfsa.im

 

Marc Barlow

Senior Manager - Banking

T: +44 (0)1624 689369

E: marc.barlow@iomfsa.im