Read our Basel III quick wins consultation paper
In 2021, we consulted with Jersey incorporated banks and proposed implementing specific changes to help our regulatory regime align with the Basel III Framework.
See our 2021 Basel III position paper.
We have published a new consultation paper proposing the adoption of certain elements outlined in our 2021 paper, considering the feedback we received in 2021.
Read our new Basel III quick wins consultation paper.
Our proposals
In our new consultation paper, we propose:
- aligning capital minima with the Basel Framework at 4.5% for CET 1 capital, 6% for Tier 1 capital and 8% for total capital.
- a capital conservation buffer at 2.5%
- permitting holdings of certain Public Sector Entities’ issued or guaranteed securities to be included as High-Quality Liquid Assets
- widening the list of eligible top tier Multilateral Development Banks (MDBs) to align with the current Basel Framework and for capital purposes
- permitting Public Sector Entity concession limits to be approved
- creating a carved-out concession limit framework for short-term government bills (under one year to maturity) and central bank reserves.
Proposals on “systemic importance, leverage ratio, trading book, market risk, counterparty credit risk and the NSFR” are not being taken forward at this time but are outlined in section 2.2.4 of our Basel III prudential roadmap, where we detail our plans to implement of the rest of Basel III.
As a result of our proposals, certain guidance would require updates. Documents showing proposed amendments are linked below and are available on our Basel III page:
Banking code of practice
Draft reporting guides
- Prudential reporting of capital ratios
- Prudential reporting of liquidity ratios
- Prudential reporting of credit risk under the standardised approach to credit risk
Draft guidance notes
- Draft guidance note “Pillar 2 in Jersey”, showing proposed amendments
- Draft guidance note “Approval of Concession Limits for Governments and Connected Banks”, showing proposed amendments
Next steps
We aim to publish the feedback by the end of Q3 2024 and propose that the changes take effect on 1 January 2025.
Submit your feedback to David Fisher at d.fisher@jerseyfsc.org by 30 June 2024.