Credit Risk Mitigation Standing Group
Terms of reference
Purpose
The purpose of the CRMSG is to help the FSA formulate its policy prior to consultation, it does not replace consultation so may not definitively resolve any matters discussed.
The CRMSG is a pre-consultation forum for discussing:
- Credit Risk Mitigation policy issues arising from the revised Basel Accord (Basel) and the Capital Requirements Directive (CRD);
- the FSA's articulation of its potential solutions in Prudential Source Book (PSB) text;
- issues regarding the practical implementation of, and monitoring of compliance with, Credit Risk Mitigation policy in the PSB; and
- domestic Credit Risk Mitigation issues (e.g. IPRU) not covered by Basel or the CRD.
The CRMSG will be the medium by which the FSA will:
- discuss its approach to, and process for, developing rules and to identify areas where guidance may need to be issued to implement the CRD for Credit Risk Mitigation;
- collaborate with firms to develop it's Credit Risk Mitigation policy in the PSB;
- collaborate with firms to address issues regarding the implementation of, and the monitoring of compliance with, Credit Risk Mitigation policy in the PSB; and
- identify the substantive Credit Risk Mitigation issues that need to be raised with the Basel Advisory Group and the PSB Advisory Group.
Remit
The CRMSG will be responsible for:
- the Standardised Approach to Credit Risk Mitigation;
- minimum requirements under the IRB Approach to Credit Risk Mitigation;
- IPRU Credit Risk Mitigation issues; and
- Pillar 2 adjustments for Credit Risk Mitigation.
General Credit Risk and Securitisation issues are to be discussed within separate Standing Groups.