Entire Section

  • Introduction

    • PIB 3 Guidance

      1. This chapter deals with all aspects of prudential requirements relating to capital adequacy. The chapter aims to ensure that an Authorised Firm maintains adequate capital to support the risks associated with its activities and that it can absorb potential unexpected losses to its capital. It also includes provisions forming part of the framework for assessing the capital adequacy of an Authorised Firm.
      2. PIB 3 Part 1 of this chapter deals with the application provisions. PIB 3 Part 2 outlines the fundamental capital adequacy obligations and systems and controls requirements to ensure compliance with this critical regulatory obligation. PIB 3 Part 3 includes all the Rules and associated guidance for the calculation of minimum Capital Requirement for different Categories of Authorised Firms. This part also specifies the requirements in respect of Capital Buffers and associated obligations. It specifies three types of Capital Buffers: the Capital Conservation Buffer, the Countercyclical Capital Buffer and the HLA Capital Buffer. PIB 3 Part 4 of this chapter specifies detailed Rules on the calculation of Capital Resources of an Authorised Firm, including detailed Rules on the eligibility criteria for different components of Capital Resources which correspond to varying levels of quality.
      3. PIB Appendix 3 provides detailed guidance on various aspects of stress and scenario testing which are required to be considered by an Authorised Firm to effectively comply with the Rules in this chapter.
      Derived from RM111/2012 (Made 15th October 2012). [VER20/12-12]
      [Amended] DFSA RM209/2017 (Made 25th October 2017). [VER30/01-18]