RBI's Revised Basel Pillar 3 Disclosure Framework
The Reserve Bank of India (RBI) has issued 10 amendment directions to revise its Basel Pillar 3 disclosure framework. This update aims to strengthen market discipline by enhancing public disclosures for various banking entities.
Key Objectives
- Market Discipline: The amendments aim to improve market discipline through comprehensive disclosures.
- Transparency: The framework seeks to improve transparency about banks' capital positions and risk exposures.
Scope and Applicability
- Applies to commercial banks, small finance banks, and payments banks.
- Disclosure requirements apply across all regulated banking entities.
- Banking groups must disclose at the top consolidated level; non-top entities must publish standalone disclosures.
Disclosure Requirements
- Banks must establish a formal disclosure policy approved by their boards.
- Year-end Pillar 3 reports must include key policy elements.
- All disclosures are subject to internal review and control processes.
Prudential Norms Covered
- Capital adequacy
- Asset-liability management
- Governance
- Financial statement presentation
Future Directions
- Separate templates for market risk, operational risk, counterparty credit risk, credit valuation adjustment, and leverage ratio for commercial banks will be issued.
- Feedback on these templates will be considered before issuance.
