2018 Q3 Banking Regulation Bulletin released

The bulletin, prepared by the Banking Regulation Department, presents regulatory acts issued within the past quarter as well as draft regulations and consultation papers posted on the Bank of Russia website.

In particular, the third quarter of this year saw the publication of regulations laying out the following regulatory changes: updates to the methodology for measuring credit institutions’ capital — to reflect the focus on higher reliability and transparency of capital sources; provisions for a ban on including in a credit institution's capital funds from subordinated bonds for the benefit of individuals who are not qualified investors; as regards banks holding universal licences, changes were made to the composition and structure of information they submit in respect of corporate procedures for capital adequacy assessments and their outcomes.

Also, the above documents upgrade, as part of capital adequacy calculations, risk ratios on credit claims to legal entities in foreign currency, which arose after 1 July 2018; and update the risk ratio scale relating to consumer loans depending on the range of the effective interest rate on credit.

The Bank of Russia also prepared several draft regulations upholding current approaches to capital and loss provision calculation for prudential purposes related to the rollout of IFRS 9 ‘Financial Instruments’. These extend to projects focused on support and development of banks with a basic licence, SME and other areas of the Russian economy. These draft documents were published on the Bank of Russia website in 2018 Q3 for regulatory impact assessment.