On March 4 the Colombian Ministry of Finance and Public Finance issued Decree 175 with provisions on the technical equity of trust companies, pension and severance fund management companies, brokerage firms and investment management companies. The regulation is already in force.
The document amends Decree No. 2555, which regulates the financial sector and the securities market, to update the instruments that make up the technical equity and the minimum solvency levels of entities that manage third party assets. In this sense, articles related to the classification and weighting of assets and exposures for credit risk, to the adequate equity for trust companies with their corresponding sanctions and to the criteria for belonging to the Basic Equity and Additional Equity, among other points, are modified.
The purpose of the initiative is to strengthen the technical equity rules of trust companies by strengthening the instruments that make up the regulatory capital, updating the risk measurement methodologies associated with the nature of the operations carried out by these entities and homogenizing the standards applicable to the entities in the sector.