Qatar is one of the few jurisdictions and the second among the GCC countries to have set the timeline for meeting the official Basel III-Reforms implementation date. Under the regulatory direction and guidance of QCB Qatari Banks are required to adopt Basel III Reforms starting from the 1st of January, 2024 which is in line the timeline targeted by most large economies of the world.

Key Takeaways

  • Qatar aligns with Basel III reforms on an international timeline, being an early GCC adopter, with implementation set for January 1, 2024, directed by the Qatar Central Bank.
  • QCB introduces robust credit risk measures, with a focus on risk sensitivity, LTV-based risk weight assignments, due diligence requirements, and revised frameworks. Counterparty credit risk and market risk are addressed through standardized approaches, and a new operational risk measurement approach is introduced.
  • Banks in Qatar may face challenges in adapting to the new Basel III standards, including readiness issues, data complexities, adjustments to business models, along with regulatory differences and impact on pricing and earnings.

QCB published circular 33/2022 and circular 34/2022 encapsulating the Basel III -Reforms implementation guidelines for Islamic and Conventional Banks respectively with 1st January 2024 as the timeline for adoption. The objectives of these reforms are to better capitalize the banking sector, reduce liquidity risk, limit vulnerabilities associated with the real estate sector, and make banks more transparent to market participants and supervisors.

Shubhadip Bhattacharya
Director, FRM
KPMG in Qatar

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