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Gleeson on the International Regulation of Banking, 3rd Edition by Gleeson, Simon (30th August 2018)

Part VI Bank Group Supervision, 27 Pillar 3—Disclosure Requirements

From: Gleeson on the International Regulation of Banking (3rd Edition)

Simon Gleeson

From: Oxford Legal Research Library (http://olrl.ouplaw.com). (c) Oxford University Press, 2015. All Rights Reserved.date: 25 August 2019

Subject(s):
Regulation of banks — Credit risk — Transparency Directive — Financial regulation — Basel 3 — Basel committee on Banking Supervision

The Basel pillar 3 regime constitutes a disclosure regime for regulated banks. The aim is to provide sufficient transparency for investors to ensure that the price which banks pay to raise capital in the market reflects the level of risk undertaken by the bank. The pillar 3 regime was restructured in 2015, and is in the process of being further restructured. This chapter discusses the March 2017 standards which were broadly brought into force as from 2017. The most important change introduced by the 2017 standards is the formalisation of the disclosure templates. Regulators have struggled with banks over pillar 3 disclosures for many years — in effect, each bank sought to present information in a way which is most relevant to oits particular business and structure, whereas regulators seek to achieve comparability across banks with different businesses and structures. This process has resulted in a tightening of disclosure standards applicable to pillar three disclosures, to the extent that the regulators now provide detailed disclosure templates for each subdivision of required disclosure.

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