Guidelines for counterparty credit risk management

The Basel Committee on Banking Supervision (BCBS) published new Guidelines for Counterparty Credit Risk (CCR) Management on 11 December 2024, replacing its 1999 paper on interactions with highly leveraged institutions. The guidelines address industry weaknesses by emphasizing due diligence of counterparties, comprehensive credit risk mitigation strategies, diverse CCR metrics, and robust governance frameworks. The Hong Kong Monetary Authority (HKMA) will update its Supervisory Policy Manual module CR-G-13 accordingly and encourages authorized institutions to review and enhance their CCR management practices in line with the new guidelines.

Resources: https://www.hkma.gov.hk/media/eng/doc/key-information/guidelines-and-circular/2024/20241213e4.pdf