The Board of the Chile Financial Market Commission (CMF), through Exempt Resolution No. 862, has decided to apply additional capital requirements to banks under Basel III Pillar 2 following the conclusion of its supervisory assessment of each institution’s business model. The Pillar 2 requirements will apply to Banco Bice, Banco BTG Pactual Chile, Banco Consorcio, Banco del Estado de Chile, Banco Internacional, HSBC Bank (Chile) and Banco Santander. Relative to prior settings, requirements decreased for three banks, were unchanged for three and increased for one, in line with the institutions’ business models. The CMF linked the process to banks’ Effective Equity Self-Assessment Report, which sets an internal effective capital target over at least a three-year horizon and covers material risks beyond Pillar 1, including banking book market risk and credit concentration risk. It also noted that banks’ current internal targets already include buffers above minimum regulatory requirements, so meeting the updated Pillar 2 add-ons should not require new capital injections. As part of the gradual implementation approach in this third year of applying Pillar 2, 75% of the requirement must be constituted by 30 June 2026 as part of minimum regulatory requirements, with the remainder to be built up as determined by the CMF in next year’s Capital Adequacy Assessment.
Chile Financial Market Commission 2026-01-16
Chile Financial Market Commission applies Basel III Pillar 2 capital add-ons to seven banks with 75% to be met by 30 June 2026
The Chile Financial Market Commission imposed additional Basel III Pillar 2 capital requirements on seven banks, including Banco Bice and Banco Santander, after a supervisory assessment. Adjustments varied: requirements decreased for three banks, remained unchanged for three, and increased for one, based on their business models. The Commission noted that banks' current internal targets already include buffers above minimum regulatory requirements, so no new capital injections are needed.