Happy New Year!
2014 was the year of record settlements between banks and regulators with the total amount of fines and settlements globally passing USD 56 billion. The biggest single hit was the settlement of USD 16.65 billion between Bank of America and the United States Department of Justice in relation to the misleading of investors with mortgage backed securities.
Local regulators are tightening their compliance legislation. The QFCRA has introduced enhancements to its prudential framework for QFC authorised firms undertaking banking, investment management or advisory business. Two new sets of prudential rules were introduced: the Banking Business Prudential Rules 2014 and the Investment Management and Advisory Rules 2014. The new Rules come into force on 1 January 2015.
The new Banking Business Rules bring enhancements focused on the following areas:
•The Internal Capital Adequacy Assessment Process
•Capital adequacy and capital requirements
•Credit risk
•Market risk
•Interest rate risk in the banking book
•Liquidity risk
•Group risk
The new Investment Management and Advisory Rules bring enhancements focused on the Minimum paid-up share capital and liquid assets requirement, Risk management, Professional Indemnity Insurance and on the Client money and asset protection.
