Notice - Amendments to the Standardised Approach to Measuring Credit Risk (2022-05-23)

Summary

This is a notice from the Bermuda Monetary Authority announcing a consultation paper on proposed amendments to the standardised approach used to calculate minimum capital requirements for credit risk. The BMA is proposing to adopt the Basel Committee's December 2017 Basel III reforms, specifically the Revised Standardised Approach (RSA) for credit risk, as applied to banks operating in Bermuda.

• Purpose: Sets out the Authority's proposed adoption of Basel's Revised Standardised Approach for measuring credit risk capital charges for banks.
• Rationale: Aims to align Bermuda's banking regulatory framework with international standards while keeping it appropriate for the local banking sector.
• Implementation timing: No firm implementation date is set; the Authority states it will work with industry to establish an appropriate implementation date given the extent of the changes.
• Consultation process: Industry and other stakeholders are invited to comment on the proposals by emailing banking@bma.bm.

This document is a consultation notice rather than a binding rule change; it does not itself impose new capital requirements but signals forthcoming changes to the standardised approach for credit risk that banks should monitor and may wish to comment on.

Applies to

banks

Deadlines

• 19 August 2022: Deadline for industry and other stakeholders to submit feedback on the consultation paper by emailing banking@bma.bm.