Our progress / Hot Topics

Financial markets megaregulator

Back to Media

Central Bank to Toughen Capital Quality Requirements in January 2016

01.09.2015 12:00 / TASS

The Bank of Russia plans to introduce tougher capital quality requirements for banks on 1 January 2016, as part of the transition to Basel III. This measure will effectively remove the so-called ‘fictitious capital’ from the calculation base, according to the draft regulation.

“The draft regulation aims to neutralize schemes used by banks to inflate their capital, by removing the ‘fictitious capital’ from the bank capital calculation base”, states the accompanying letter.

The Bank of Russia plans to establish the principle of presenting printed proof of capital origin, showing income as part of capital only after they have been received, detailing indirect investment of a bank in own capital, as well as showing subordinated loans as capital only after the bank has presented printed proof of origin of cash used to pay off the subordinated loans.

Earlier, in mid-June, the CB selected 10 banks with critical financial market infrastructure status that will comply with Basel III capital and liquidity requirements.

Financial markets megaregulatorProject Group №1