On Nov. 3, CHI CSRC proposed revisions to calculation standards.
CHI CSRC proposed revision to Regulations on calculation of risk control indicators for securities companies, in order to comprehensively strengthen institutional supervision.
Aims to enhance the risk control indicator system of securities companies and promote comprehensive risk management, while improving investment banking capabilities.
Revisions
Focus on serving the real economy by optimizing risk control indicators for market-making, asset management, and participation in public REIT businesses.
Strengthen classification-based supervision, adjusting risk capital factors, encouraging the use of advanced risk measurement methods for high-quality securities companies.
Emphasize risk management by rationalizing calculation standards based on business risks, maturity mismatches, and higher measurement standards for OTC derivatives.
Consultation End
The consultation is open until Dec. 3, 2023.
Sep. 2024 Regulations Finalized
On Sep. 20, 2024, CHI CSRC issued revisedRegulations on the calculation standards of risk control indicators for securities companies in order to effectively prevent risks.
Improved standards for securities firms' stock investments, market-making, and other business activities to encourage long-term value investment, support real economy.
Optimized classification and adjustment coefficients to allow compliant and stable firms to enhance capital efficiency, providing better financial services to the real economy.
All business activities, including participation in public REITs, are covered under risk control indicators to ensure more comprehensive, scientific risk management system.
More stringent calculation standards for innovative and higher-risk businesses.
CSRC fully absorbed most suggestions; opinions that were not fully absorbed are mainly on relaxing calculation standards re innovative businesses like OTC derivatives.
The regulations will be effective from Jan. 1, 2025.
