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Dubai Financial Services Authority (DFSA): Contents

Dubai Financial Services Authority (DFSA)
Laws
Rulebook Modules
Prudential — Investment, Insurance Intermediation and Banking Module (PIB) [VER33/02-19]
Sourcebook Modules
Consultation Papers
Policy Statements
DFSA Codes of Practice
Amendments to Legislation
Media Releases
Notices
Financial Markets Tribunal
Archive

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  • PIB A9.1 Application for a Global Liquidity Concession

    • PIB A9.1.1

      (1) This Rule applies to an Authorised FirmG carrying on business in or from the DIFCG through a BranchG that applies for a global liquidity concession under PIB Rule 9.3.2.
      (2) The Authorised FirmG must demonstrate to the DFSAG that:
      (a) its BranchG complies with all applicable liquidity systems and controls requirements in sections PIB 9.2 and PIB 9.2A;
      (b) its head office is established in a jurisdiction where there are no legal constraints imposed by the home supervisor or any other authority on the provision of liquidity to its branch; and
      (c) its head office is subject to equivalent or more restrictive liquidity requirements, than those imposed by the DFSAG .
      (3) The DFSAG may, when considering an application from the Authorised FirmG for a global liquidity concession, impose additional or alternative conditions to those specified in (2) or disapply a condition in (2).
      [Added] DFSA RM148/2014 (Made 1st January 2015). [VER23/01-15]

      • PIB A9.1.1 Guidance

        1. An application for a global liquidity concession pursuant to PIB Rule 9.3.2 should include at least the following:
        a. a clear description of the home supervisor's requirements for managing, monitoring and controlling liquidity risk;
        b. a clear description of the systems and controls used by the head office to ensure the adequacy of the Branch'sG liquidity;
        c. a written assurance from the Authorised Firm'sG head office that it will:
        i. ensure that adequate liquidity is available at all times to support the branch;
        ii. notify the DFSAG , at the same time as it notifies its home supervisor, of any material issues concerning its exposure to Liquidity RiskG and issues in relation to its compliance with applicable liquidity limits, including its liquidity coverage ratio; and
        iii. in the event of a liquidity crisis, provide the DFSAG with all relevant information on the whole Authorised Firm'sG liquidity, and a list of any known constraints on the head office, legal or otherwise, to providing the branch with liquidity.
        d. a notification from the Authorised Firm'sG home supervisor:
        i. expressing no objection to the branch obtaining the DFSA'sG liquidity concession or acknowledging the branch application to the DFSAG for a global liquidity concession; and
        ii. providing information about, and confirming, the quality of Liquidity RiskG systems and controls and the liquidity exposures at the Authorised Firm'sG head office.
        2. Under PIB Rule A9.1.1(2)(b), the DFSAG will consider liquidity transfer restrictions (e.g. ring-fencing measures, non-convertibility of local currency, foreign exchange controls) imposed under applicable laws, regulations or supervisory requirements in jurisdictions in which a banking group operates which affect the availability of liquidity by inhibiting the transfer of HQLA and fund flows within the GroupG .
        Derived from RM111/2012 (Made 15th October 2012). [VER20/12-12]
        [Amended] DFSA RM148/2014 (Made 1st January 2015). [VER23/01-15]

    • PIB A9.1.2

      (1) An Authorised FirmG that has been granted a global liquidity concession must provide the DFSAG with ongoing assurance about its Liquidity RiskG by:
      (a) submitting to the DFSAG at least quarterly a copy of the LCR calculation for the Authorised FirmG , as submitted by its head office to its home supervisor;
      (b) notifying the DFSAG immediately of the results of every assessment which its home supervisor conducts which relates to the quality of liquidity systems and controls at its head office;
      (c) notifying the DFSAG in writing immediately of any adverse finding or action taken by its home supervisor;
      (d) notifying the DFSAG in writing immediately of any potential change in the branch funding strategy, business model or material potential change in its balance sheet structure; and
      (e) notifying the DFSAG in writing immediately of any changes relating to its compliance with the conditions referred to in PIB Rule A9.1.1.
      (2) The DFSAG may at any time, based on its assessment of the Liquidity RiskG exposures of an Authorised FirmG , by written notice adjust or exclude any of the requirements in (1), impose additional requirements or cancel the global liquidity concession granted to the Authorised FirmG .
      [Added] DFSA RM148/2014 (Made 1st January 2015). [VER23/01-15]