The three key areas involving G-SII policy measures will focus upon:
- Enhanced supervision;
- Resolution; and
- Greater ability to absorb loses (HLA).
Enhanced supervision will focus upon:
- The role of the group-wide supervisor and other involved supervisors;
- Policy guidelines for effective supervision;
- Liquidity measures;
- A strategic risk management plan (SRMP) (formerly known as the Systemic Risk Reduction Plan); and
- Supervision of otherwise non-regulated financial entities.
Resolution Plan will require:
- G-SIIs and group-wide supervisors developing a SRMP that address the key risks;
- Supervisors monitoring the implementation of SRMPs; and
- SRMPs may include separation, restriction and/or prohibition of NTNI activities
Greater Loss Absorbency:
- Non-regulated entities will be required to have loss absorbency to bring this up to prudential standard that prevent regulatory capital arbitrage;
- The method for calculating HLA on all types of insurance based financial conglomerates; and
- The method for calculating HLA based on the amount of NTNI activities.
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