BASEL, Switzerland, Thursday, July 4, 2024- The Basel Committee on Banking Supervision (BCBS) announced a series of measures on Wednesday aimed at strengthening oversight of banks’ cryptoasset holdings, managing interest rate risk, and mitigating risks associated with third-party service providers.
The framework takes effect in January 2026.
The committee finalized a disclosure framework requiring banks to publicly report their cryptoasset exposures using standardized templates.
This increased transparency aims to improve market discipline and understanding of bank involvement in the crypto market. Additionally, the BCBS approved targeted revisions to its cryptoasset prudential standard. These revisions clarify the criteria for stablecoins to receive preferential regulatory treatment, promoting consistent application of the standard across jurisdictions.
The committee acknowledged the potential risks associated with banks issuing tokenized deposits and stablecoins but concluded that existing regulations are sufficient for current market conditions. Continued monitoring of this area was highlighted.
The BCBS approved adjustments to the interest rate shock sizes and calculation methodology within its interest rate risk in the banking book (IRRBB) standard.
These changes aim to better reflect current market dynamics, particularly in low-interest-rate environments. The updated standard is effective January 2026 and is separate from the committee’s ongoing analysis of the March 2023 banking turmoil.
The committee announced a consultation on updated principles for managing third-party risk in the banking sector. These principles replace existing outsourcing guidance and aim to address the evolving landscape of third-party service providers. The consultation document will be published soon.
The BCBS is continuing its work on developing a Pillar 3 disclosure framework for climate-related financial risks. This framework aligns with the committee’s broader approach to addressing these emerging risks.
BASEL Committee’s full statement “Basel Committee approves disclosure framework and capital standard for banks’ cryptoasset exposures and amendments to interest rate risk in the banking book standard, and agrees to consult on third-party risk principles” can be read here.
