FSS Governor Lee Chan-jin discusses 'crypto-asset prudential rules' in Basel

Lee Chan-jin, governor of the Financial Supervisory Service (FSS), attended the top-level meeting of the Basel Committee on Banking Supervision (BCBS)—the Group of Central Bank Governors and Heads of Supervision (GHOS)—where he shared an update on market conditions stemming from the latest Middle East situation and exchanged views on key risks to financial markets as well as regulation and supervision of digital assets.

According to the FSS on the 12th, at the BCBS GHOS meeting held on the 9th (local time) in Basel, Switzerland, heads of financial supervisory authorities and central bank governors from 28 countries reviewed the global implementation status of the Basel III framework.

Currently, about 75% of member jurisdictions are implementing Basel III or preparing to adopt it. South Korea established a regulatory framework aligned with global standards by introducing the final standards for market and operational risk in June 2023.

A key focus of the meeting was how to manage the banking sector’s prudential soundness amid the growth of the crypto-asset market. Participants reviewed prudential standards for banks’ crypto-asset exposures and approved a plan to revisit the methodology for assessing global systemically important banks (G-SIBs) to better reflect the current regulatory framework. This suggests that banks may face tighter capital requirements when holding crypto assets or providing related services going forward.

Lee also met with ECB President Christine Lagarde in Frankfurt, Germany, and shared views on key risks in global financial markets and the direction of regulation and supervision for digital assets.

Noh Jeong-dong, Hankyung.com reporter dong2@hankyung.com