The Basel Committee on Banking Supervision made major, credit-union friendly revisions to the final version of its banking supervision guidance, taking into account comments and concerns expressed by the World Council of Credit Unions. The World Council wrote to the committee to correct a number of inaccuracies in the proposal earlier this year.
The Switzerland-based Basel Committee is the primary global prudential standard-setter for regulation of banks around the world. Its proposal was titled Guidance on the application of the Guidance on the application of the Core Principles for Effective Banking Supervision to the regulation and supervision of institutions relevant to financial inclusion.
The final standard issued by the committee removed a number of inaccurate claims about credit unions present in the proposal, including:
In addition, World Council’s advocacy efforts helped ensure that the Basel Committee’s final rule on total loss absorbing capacity does not apply to credit unions.
At the World Council’s urging, the finalized rule only applies to the 30 largest “systematically important” banks, and other institutions that invest in those banks’ convertible bonds.