UAE: ADGM to amend prudential regime for financial institutions
Source: Middle East Insurance Review | Dec 2017
The Financial Services Regulatory Authority (FSRA) of Abu Dhabi Global Market (ADGM) has issued a consultation paper inviting public feedback on its proposals to revise the “Prudential – Investment, Insurance Intermediation and Banking” Rulebook (PRU).
The proposals will align the requirements in PRU more closely with the current regulatory prudential regime developed by the Basel Committee on Banking Supervision (BCBS).
Specific areas of focus include the introduction of capital requirements through the implementation of a Cyclical Capital Buffer, Credit Valuation Adjustment and Central Counterparties frameworks.
Proposals also include assessments of the ability of various capital instruments to absorb losses at the point of non-viability and the full implementation of the leverage ratio floor. The consultation is also looking at the disclosure of the leverage ratio and the liquidity coverage ratio, as well as new market reporting requirements. The ADGM also hopes that the additional amendments will provide greater clarity to financial institutions operating in ADGM.
The proposed revision is part of the FSRA’s commitment and ongoing efforts to maintain an internationally-recognised, transparent and robust prudential regime. Responses to the consultation are expected by 7 December. M