Banking regulation: published in the Bulletin for the first quarter of 2020

The Bank of Russia has published a quarterly newsletter with a list of regulations and informational letters issued during the first quarter of 2020 and introducing a number of innovations in the regulation of activities of credit organizations. Also, the Bulletin provides a list of regulations posted for regulatory impact assessment.

In the first quarter was introduced a number of temporary regulatory and Supervisory relief measures for credit institutions in a situation of the spread of coronavirus infection. These decisions were taken to maintain the capacity of banks to lending to the real sector of economy and to minimize the negative impact of restrictive measures for the fight against the pandemic coronavirus infection.

Also, the Bank of Russia has published new instructions on the composition and procedure for the disclosure by the regulator of the information contained in credit institutions ‘ reporting, the information letter, explaining the procedure and terms of submission of information about the organization of the internal procedures of capital adequacy assessment (ITTC) and their results. In addition, the regulator explained to banks the possibility not to apply to calculation of capital adequacy ratios in accordance with the new standardized approach, the elevated risk ratio is 130% for loans for the construction and reconstruction of residential and non-residential buildings, acquisition of land for construction of buildings.

In the I quarter was published for regulatory impact assessment a number of projects of normative acts:

— the introduction of a new standardized approach Basel III for calculation of operational risk to be included in the calculation of capital adequacy;

— changes to the procedure for the calculation of credit risk based on internal ratings in accordance with the new standardized approach Basel III;

— determination of approaches to the formation of reserves for possible losses on monetary claims and contingent liabilities of credit nature, as well as clarifying elements of the calculation base of reserve of assets recognised in the accounts in connection with the implementation of IAS 16;

— change the order of calculation of own funds (capital) of credit organizations with the new order of reflection of lease contracts in the accounts in accordance with IFRS 16 (re-location, the project was supplemented by some standards).