Investor Presentaiton
Annual Report
AR
2022
SUMMARY
WHO WE
ARE
OUR
STRENGTH
AND
OUR
RESOURCES
OUR
RESULTS
National Financial Stability
Alignment of accounting rules and tax rules in
the acknowledgement of losses associated to
credit risk
The alignment of accounting rules and tax rules in the
acknowledgement of losses associated to credit risk
followed international standards on financial reporting.
Acknowledging such losses aims at reducing the recognized
amount of tax credits and, consequently, also reducing the
need to allocate additional prudential capital for institutions
that hold these assets.
This regulatory adjustment creates conditions for an
enhancement in credit concession within the SFN, having
direct and indirect effects on the cost of credit, on economic
growth, and on tax collection. The new rules will be effective
in 2025 given the complexity of the subject and the
magnitude of efforts needed for their implementation by
financial institutions and by the BCB.
Market and credit risks management by
supervised entities
The BCB carried on with the domestic adoption of the
set of prudential measures called Basel III, following the
recommendations of the Basel Committee on Banking
Supervision (BCBS).
The prudential regulation on market risk management
started to allow the adoption of more advanced
prerogatives in the management of this risk by the
supervised entities, provided they are authorized by the
BCB. The criteria for classifying instruments in the trading
or banking book went into effect in March 2022 and the
other provisions are scheduled to go into effect in January
2023. New rules for calculating the capital requirement for
credit risk of financial instruments classified in the trading
book are expected to be published in 2023.
Three segments of supervised entities may request
specific authorizations for special market risk management
procedures, with the possibility of benefits in the regulatory
capital calculation. In 2022, specialized supervision has
structured processes for technical evaluation of these
requests. The granting of more sophisticated possibilities
in market risk management implies compliance with better
governance and capital allocation practices, resulting in
more sound and efficient supervised entities.
Still in 2022, the BCB launched a public consultation on the
regulatory proposals that implement the minimum capital
requirements for operational risk. The new methodology
for the calculation of the required capital for operational
risk replaces three methodologies currently in force with
a single standardized model.
The standardized approach to calculate the risk-based
capital requirements for credit risk was also reviewed. The
new regulation reflects the most recent recommendations
of the BCBS on the subject. The new rules make the
framework more robust and risk-sensitive by increasing the
risk weights granularity, which allows for a more optimized
use of capital resources.
New prudential rules and proportional
supervision model for payment institutions
Payment institutions are now required to observe
prudential rules proportional to their size and complexity,
in a similar form to those already in place for financial
institutions. The simplification of treatment and
procedures aligns the rules to the reality of the segment,
which tends to offer innovative products and services.
The new regulation preserves the ease of entry for
new competitors in the payment segment, to increase
competition in the system. The new rules will be effective
from July 2023, with a two-year phased implementation.
A specific methodology was also developed for the
proportional supervision of payment institutions not
subject to BCB's authorization that are part of the SPB,
exclusively because of their participation in the Pix payment
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