The modifications in the regulations cover banks, financial intermediation institutions, non-bank financial institutions and the stock market.
The Superintendence of Financial Services (SSF) of the Central Bank of Uruguay (BCU) published this Friday Annual Regulation Plan 2023where the projects that will seek to renew before December all the sectors covered by the regulation of the entity are delimited.
The annual plan is inserted, in turn, within the Strategy and Action Plan 2020-2028 of the SSF, with the purpose of indicating the direction in the short and medium term Regarding the control exercised by the BCU, provide predictability to the industry and involve other actors in the design of the changes.
One by one, all the projects for the financial sector in 2023
The SSF must ensure a financial system “solid, modern, competitive, efficient and accessible to users”. Based on them, the changes that are projected for this year and their respective areas of implementation are as follows.
all markets
- Make regulatory adjustments to improve efficiency in Authorization processes, something that will seek to reduce deadlines and improve the efficiency of these processes. The issuance of the new regulations is expected to occur before the fourth quarter.
- Establish mechanisms for setting market prices in the event of significant holdings in public offering instruments. Thus, an attempt will be made to establish an “adequate valuation” in public offerings that lack market value. A public consultation will be held in the third quarter and the measure is expected to be finalized by the end of the year.
Financial intermediation institutions
- As for the revised standardized approach for credit risk, modifications will be made to the capital requirement for credit risk and, in this way, it will seek to adapt the regulation to the international standard of Basel III. In the fourth quarter there will be a public consultation.
- To improve the timeliness and quality of the information on economic sets, there will be changes in the instructions to proceed with the ups and downs of economic groups to the Risk Center and issuance of a guide to determine control or significant influence. It is expected to be completed by the end of the year.
Banks and non-bank financial institutions
- The provisions of Annex 1 of the Roadmap Impairment Standard IFRS 9 and the provisioning percentages by risk category provided in Annex 2 of the Accounting Framework. At this point, it will also seek to align the regulations with international standards, something that is expected to be completed in the second half of the year.
- Adequacy of the Accounting Framework: the regulations on the restructuring of credit operations will be reviewed. It will seek to contemplate “situations that would warrant the exposure of the restructuring as current and a cure period for restructurings that are not exposed as current.” In the second quarter there will be a public consultation and between April, May and June the regulations will be issued.
- As for the debit balance coverage insurance, the regulatory project is ready. There, the collection of compensations or commissions for the insurance coverage of debit balance that the institutions force their clients to hire is reviewed, with the aim of strengthening the regulatory framework linked to the protection of the user of financial services.
- The regulations referring to the financial transaction report. Thus, the report format will be modernized and the repetition of data provided in other reports will be avoided. In the second quarter there will be a public consultation and in the third quarter the initiative will materialize.
- It will also restructure suspicious transaction report form. Specifically, the way STRs are presented will be modified. Meanwhile, the document will be customized for each type of financial institution, all relevant information will be systematized and errors will be minimized. It is expected to materialize in the third quarter of 2023.
Stock market
- Efforts will be made to adapt simplified emissions regulations with the idea of incorporating a non-competitive tranche. The proposal, which is expected to be ready by the end of this year, will have the objective of “promoting the use of the aforementioned regime as an alternative to traditional sources of financing, thus achieving the revitalization of the publicly offered securities market.”
Source: Ambito
