Financial Market Commission Publishes, for Public Consultation, New Regulations on Information Security and Cybersecurity for Financial Entities and Regulatory Capital Calculation for Bank
by Diego Peralta, Paulina SIlva, Carlo Benussi, Diego Lasagna
Published: February, 2020
Submission: February, 2020
Financial Market Commission publishes, for public consultation, new regulations on information security and cybersecurity for financial entities
On November 25, 2019, the Financial Market Commission published, for public consultation purposes, a proposed amendment to its Updated Regulations Compendium (“URC”), by means of enacting a new Chapter 20-10, on “Information Security Management and Cybersecurity” (the “New Regulation”)
The main characteristics of this New Regulation can be summarized as follows:
The consultation period will be open until December 27, 2019.
Authors:Diego Peralta, Paulina SIlva, Carlo Benussi, Diego Lasagna
Financial Market Commission publishes, for public consultation, new regulations on regulatory capital calculation for banks
On November 19, 2019, the Financial Market Commission published, for public consultation purposes, a proposed amendment to its Updated Regulations Compendium, by means of the enactment of a new Chapter 21-1, which sets the rules that banks shall observe to determine their effective patrimony, in order to fulfill the legal requirements set forth in the General Banking Act, (the “New Regulation”).
The New Regulation considers the amendments that were introduced on January 20191 to the General Banking Act, in accordance with Basel III guidelines, and in this regard, it adopts the terminology used by the Basel Committee on Banking Supervision to define three different capital levels:
i.- The Common Equity Tier 1 (CET1) Capital;ii.- The Additional Tier 1 (AT1) Capital, andiii.- The Tier 2 (T2) Capital.
Pursuant to the New Regulation provisions, the banks’ basic capital will be equal to CET1, after certain deductions corresponding to the value of assets whose economic value is considered either undetermined or low, or whose liquidation is difficult in financial stress scenarios. Moreover, banks’ effective patrimony shall be the sum of (i), (ii) and (iii), after such deductions.
The New Regulation will take effect on March 1, 2020, although it sets a gradual application of its rules, until December 1, 2024, where it shall be fully implemented.
The consultation period will be open until January 17, 2020.
Authors:Diego Peralta, Diego Lasagna.
Link to article
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