The Chile Financial Market Commission has issued an exempt resolution applying Pillar 2 equity requirements to a set of nine banks following its supervisory review, including an assessment of each bank’s business model, as part of Chile’s phased implementation of Basel III. The requirements apply to Banco Bice, Banco BTG Pactual Chile, Banco Consorcio, Banco del Estado de Chile, Banco Internacional, Banco Security, HSBC Bank (Chile), Banco de Chile and Scotiabank Chile. For this cycle, Pillar 2 requirements were reduced for three banks, left unchanged for three, and increased for the remaining three, in line with the banks’ defined business models. The CMF also restated that Chapter 21-13 of the Updated Compilation of Rules for Banks requires an Internal Capital Adequacy Assessment Process (ICAAP) covering at least a three-year horizon, and that the 2024 ICAAP must include Pillar 1 risks and other material risks without an established measurement standard such as banking book credit and credit concentration. As part of the gradual roll-out, 50 percent of the Pillar 2 requirement must be constituted by 30 June 2025 as part of minimum regulatory dispositions.
Chile Financial Market Commission 2025-01-17
Chile Financial Market Commission reapplies Pillar 2 equity requirements to nine banks and sets 50 percent build-up by 30 June 2025
The Chile Financial Market Commission issued an exempt resolution applying Pillar 2 equity requirements to nine banks, including Banco Bice and Scotiabank Chile, as part of Chile's phased Basel III implementation. Requirements were adjusted based on each bank's business model, with reductions for three banks, no change for three, and increases for three. The CMF emphasized the need for an Internal Capital Adequacy Assessment Process covering a three-year horizon, with 50% of the Pillar 2 requirement due by 30 June 2025.