Supervisory guidance on the use of the fair value option for financial instruments by banks

This document is intended to provide supervisors with guidance on the prudential supervision of banks’ implementation of the fair value option for financial instruments, such as under IAS 39, Financial Instruments: Recognition and Measurement, as amended in June 2005. While this guidance refers specifically to the fair value option in IAS 39, the Basel Committee on Banking Supervision (Committee) recognises that similar fair value option approaches exist or are being considered in various other accounting regimes. The Committee believes the principles set forth in this supervisory guidance should be generally applicable in such other regimes, although national supervisors will need to make that determination based on the criteria and requirements of the fair value option in their jurisdiction. This guidance focuses on supervisors’ expectations for key policy positions and sound practices for banks that the Committee believes will promote sound risk management and controls and maintain the integrity of regulatory capital measures.
(Texto en inglés)