BANKS ACT: INPUT SOUGHT ON TWO DRAFT DIRECTIVES

BANKS ACT: INPUT SOUGHT ON TWO DRAFT DIRECTIVES

• 11 April 2023
• Financial Sector
• SA Legal Academy

The Prudential Authority has called for stakeholder comments on two proposed directives affecting banks, their auditors, the branches of foreign institutions, controlling companies, their auditors and other ‘eligible institutions’.

Underpinned by the Basel Committee on Banking Supervision’s (BCBS’s) March 2021 paper on principles for operational resilience, one draft builds on a directive issued in December 2021 – which it will replace once finalised. In the context of BCBS best practice, it requires banks to consider the ‘adequacy and robustness’ of their policies, processes and practices – extending the deadline for compliance to 31 December 2024. Stakeholders have until 25 April 2023 to comment on these proposals.

The other draft deals with matters related to the capital treatment of investments in insurance entities. It specifies the manner in which the limited recognition framework provided for in Banks Act Regulation 38 should be applied in certain circumstances by banks with significant investments in insurance entities. The deadline for input on these proposals has been set at 17 May 2023.

• draft directive on operational resilience
• December 2021 directive (to be replaced)
• draft directive on the capital treatment of investments in insurance entities (with proposed reporting template)

Published by SA Legal Academy Policy Watch

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