The Basel Committee on Banking Supervision Friday published a report on the regulations that implement the Basel capital framework in China.
According to the Basel committee, China's implementation of the Basel capital framework was found to be closely aligned with the Basel III global standards, and the overall framework of China's capital regulation was graded "Compliant".
Basel III is a comprehensive set of reform measures, which is considered as a global regulatory framework to strengthen regulation, supervision and risk management of the banking sector following the recent financial crisis.
The compliance of China's domestic capital rules with the international Basel capital standards was assessed as part of the Basel committee's Regulatory Consistency Assessment Program (RCAP), as introduced by the international banking watchdog.
It said that the assessment team held discussions with senior officials and staff of the China Banking Regulatory Commission (CBRC), and met with senior representatives from the People's Bank of China, selected commercial banks and audit firms based in China.
The committee pointed out that during the assessment, the CBRC issued four new regulatory documents that rectified a number of provisions that were initially identified as deviations from the Basel framework, which considerably improved the level of compliance with the Basel standards, having noted that the CBRC's response to the report expresses the strong commitment of the Chinese authorities to implement the global regulatory reforms.
The committee monitors the timely adoption of regulations by its members, assesses their consistency with the Basel framework and analyses the quality of intended regulatory outcomes through the RCAP which also helps member jurisdictions to identify deviations from the Basel framework and assesses the materiality of any deviations.
It is introduced that the China report is the sixth RCAP assessment of Basel III capital standards after those on the European Union, Japan, Singapore, Switzerland and the United States.
