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BANKS: LARGE EXPOSURES MEASUREMENT, NEW CONTROL DIRECTIVE OUT FOR COMMENT
- 22 October 2025
- Financial Sector
- SA Legal Academy
The Prudential Authority has called for input by 29 October 2025 on a draft directive under the 1990 Banks Act, prescribing conditions to be met when measuring and controlling large exposures. The proposed new directive also specifies criteria to be met when appointing a large exposures approval committee.It is not clear what happened to a draft directive released in May 2025 for public comment.
Once finalised, the directive envisaged will replace one issued in May 2008 and another in April 2022.
Against that backdrop, the new draft directive covers:
- the composition of a large exposures approval committee
- the definition of large exposures
- customer relationship management considerations when calculating relevant adjusted exposure post-credit conversion factors and post-specific credit impairments
- revised market risk framework treatment in the large exposure framework
- large exposure identification, monitoring and reporting
- applying large exposure requirements to all subsidiaries within a banking group, ‘where a bank within the group has been designated as a domestic systemically important bank, domestic systemically important financial institution or global systemically important bank’
- intraday exposures treatment
- monitoring and managing interbank exposures
- applying large exposure requirements on intragroup exposures, and
- applying large exposure requirements on ‘a foreign subsidiary or branch of a bank controlling company required to report on a solo basis’.
Please click the links below for more information:
- draft directive
- Annexure 1
- Annexure 2
- Annexure 3
- comments matrix
- SA Legal Academy report on May 2025 draft directive
- May 2008 directive
- April 2022 directive
Published by SA Legal Academy Policy Watch
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