CMF Opens Public Consultation to Identify Systemically Important Banks
16 agosto 2019

CHILE

On August 12, the Financial Market Commission (CMF for its acronym in Spanish) launched a methodological proposal for a public consultation to identify systemically important banks and determine additional requirements for this type of institutions. This sees the beginning of the implementation of the new Basel III capital standards. The regulation will be available for comments until September 26.  

The regulatory proposal examines creating an index of systemic importance per entity based on four factors that reflect the local impact of financial deterioration or eventual insolvency: size, interconnection, substitutability and complexity. According to the CMF regulatory impact report, at the end of 2018, six  banks had been qualified in this way. 

A report on the implementation of this regulation prepared by the CMF can be accessed by clicking hereand a presentation on Basel III prepared by this institution can be accessed by clicking here

The CMF’s expectation is that the regulation will enter into force on December 1, 2020. The results of the process for identifying systemically important banks and their additional requirements will be reported in the form of a resolution, with the prior agreement of the Chilean Central Bank, after March 2021.

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