Perfecting the financial supervision system another step forward, the list of systemically important banks will be released

category:Finance
 Perfecting the financial supervision system another step forward, the list of systemically important banks will be released


Supplement the short board of supervision system

Since the international financial crisis, strengthening the supervision of systemically important financial institutions and preventing the problem of too big to fail has become an important part of the global financial regulatory reform. Among the 27 members of the Basel Committee on banking supervision, most of them have established the list of systemically important financial institutions and regulatory measures in their own countries.

At present, Chinas financial assets are about 338 trillion yuan, of which the total assets of the banking industry occupies a pivotal position. The person in charge of relevant departments said that considering the important position of the banking industry in Chinas financial system, four banks, including industrial and Commercial Bank of China, Agricultural Bank of China and China Construction Bank, have been listed in the list of global systemically important banks. The peoples Bank of China and the China banking and Insurance Regulatory Commission have formulated the evaluation measures, laying the foundation for the subsequent release of the list of systemically important banks and the implementation of additional regulatory requirements u3002

In fact, in recent years, the central bank has repeatedly disclosed the work of promoting systemically important financial institutions, and some achievements have also been implemented. In November 2018, the above-mentioned guiding opinions defined the overall institutional framework for the assessment, identification, additional supervision and recovery and disposal of Chinas systemically important financial institutions; in September this year, the peoples Bank of China and the China Banking and Insurance Regulatory Commission jointly issued the management measures for the total loss absorption capacity of global systemically important banks (Draft), which can be used to assess the total loss absorption capacity of Chinas systemically important banks The requirements of TLAC, the constitution of TLAC, the standard of qualified tools and the deduction rules are clarified.

According to the contents of Chinas financial stability report 2020, the next step is to make up for the shortcomings of the regulatory system, strengthen financial supervision, speed up the formulation of supporting regulatory rules for financial holding companies, formulate implementation rules for the supervision of systemically important financial institutions, and improve the regulatory system for financial infrastructure.

Which banks will be on the list?

According to the evaluation method, if a bank meets any of the following conditions, it should be included in the evaluation scope of systemically important banks: the adjusted balance of assets on and off the balance sheet measured by the denominator of leverage ratio ranks the top 30 among all banks; it has been rated as a systemically important bank in the previous year.

The evaluation method, evaluation scope, evaluation process and work division of Chinas systemically important banks are defined in the evaluation measures. The evaluation index system of Chinas systemically important banks is established from four dimensions of scale, relevance, substitutability and complexity. In the specific evaluation, the data submission template and data filling instructions will be sent to the participating banks, and the data of the participating banks will be collected and evaluated.

According to the above-mentioned department head, the evaluation process for systemically important banks is: firstly, the system importance score of participating banks is calculated by using quantitative evaluation indicators, and banks with a score of 100 points are included in the initial list of systemically important banks. Then combined with other quantitative and qualitative information to make regulatory judgment, comprehensive evaluation of the system importance of the banks.

Dong ximiao believes that the release of the assessment measures is only the basis for improving the regulatory framework of systemically important banks in China. The central bank and other departments will also publish additional regulatory provisions and other supporting details, and then release the list of systemically important banks. According to the assessment method, 30 banks will be included in the evaluation.

Higher regulatory requirements

The implementation of evaluation method means that Chinas banking industry will really usher in the era of differentiated supervision. There will also be more stringent regulation of banks selected to be included in the list of systemically important banks.

Relevant departments are responsible for saying that after the promulgation of the assessment measures, the peoples Bank of China will work with the CIRC to formulate additional regulatory requirements for systemically important banks. It is planned to put forward regulatory requirements for systemically important banks from the aspects of additional capital, leverage ratio, large amount of risk exposure, corporate governance, recovery and disposal plan, information disclosure and data submission, etc. in addition, it will establish an early correction mechanism to promote systemically important banks to reduce complexity and systemic risks, establish and improve the internal capital restraint mechanism, and enhance the ability of banks to resist risks and absorb losses Ability, improve self-help ability, prevent the risk of too big to fail. In formulating and implementing the additional regulatory requirements, the peoples Bank of China and the China Banking and Insurance Regulatory Commission will fully consider the macroeconomic situation, the demand for bank capital replenishment and the service of the real economy, and reasonably arrange the timing of the introduction.

Although the final list of systemically important banks has not been released yet, it will be jointly released by the peoples Bank of China and the China Banking and Insurance Regulatory Commission after being determined by the financial stability and Development Commission of the State Council. However, from the previous industry statistics, the list of systemically important banks may include city commercial banks and rural commercial banks in addition to state-owned large banks and joint-stock banks.

According to the above person in charge, according to the operating characteristics and systemic risk performance of different groups and types of systemically important banks, we will implement classified policies, match differentiated additional regulatory implementation plans, and set up reasonable transitional period arrangements to ensure neutral policy impact and stable and orderly implementation. Xu Chengyuan, chief financial analyst of Dongfang Jincheng, believes that in the short term, once the systemically important banks are selected, some banks will face greater pressure on the assessment of regulatory indicators, which will increase the short-term operational pressure of banks to a certain extent. Taking capital adequacy ratio as an example, due to the current capital shortage in Chinas banking industry, systemically important banks put forward higher requirements for capital adequacy ratio, which aggravates the pressure on banks to supplement capital, especially for some small and medium-sized banks such as some joint-stock banks. In the long run, becoming a systemically important bank will help banks to compress too complex business, reduce unnecessary connections with other institutions and customers, promote them to return to the origin of the banking industry, and better support the development of the real economy. Source of this article: Guo Chenqi, editor in charge of first finance and Economics_ NBJ9931

Xu Chengyuan, chief financial analyst of Dongfang Jincheng, believes that in the short term, once the systemically important banks are selected, some banks will face greater pressure on the assessment of regulatory indicators, which will increase the short-term operational pressure of banks to a certain extent. Taking capital adequacy ratio as an example, due to the current capital shortage in Chinas banking industry, systemically important banks put forward higher requirements for capital adequacy ratio, which aggravates the pressure on banks to supplement capital, especially for some small and medium-sized banks such as some joint-stock banks. In the long run, becoming a systemically important bank will help banks to compress too complex business, reduce unnecessary connections with other institutions and customers, promote them to return to the origin of the banking industry, and better support the development of the real economy.