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ESMA consults on guidelines on calculation of positions under SFTR

On 9 July 2020, the European Securities and Markets Authority (ESMA) launched a consultation on draft guidelines on the calculation of positions by trade repositories (TRs) under the Securities Financing Transactions Regulation (SFTR). The draft guidelines set out the relevant clarification to TRs with regards to the compliance with Article 4(6) of SFTR setting out … Continue Reading

EBA calls on resolution authorities to consider the impact of COVID-19 on resolution strategies and resolvability assessments

On 9 July 2020, the European Banking Authority (EBA) published a statement on resolution planning in light of the COVID-19 pandemic. With this statement, the EBA intends to reiterate the importance of resolution planning in times of uncertainty to ensure that resolution stands as a credible option in times of stress.  In addition, the EBA … Continue Reading

FSB and Basel Committee set out supervisory recommendations for benchmark transition

On 9 July 2020, the Financial Stability Board (FSB) and the Basel Committee on Banking Supervision (Basel Committee) issued a report on supervisory issues associated with benchmark transition. The report includes insights on remaining challenges to LIBOR transition based on surveys undertaken by the FSB, the Basel Committee and the International Association of Insurance Supervisors. … Continue Reading

Basel Committee publication: Targeted revisions to the CVA risk framework

On 8 July 2020, the Basel Committee on Banking Supervision (Basel Committee) published a paper setting out the final targeted revisions to the credit valuation adjustment (CVA) risk framework. In January 2019 the Basel Committee published the revised market risk framework. In November 2019 the Basel Committee consulted on a set of targeted final revisions … Continue Reading

ECB consultation on supervisory approach to consolidation for banks in the SSM

On 1 July 2020, the European Central Bank (ECB) published for consultation a guide intended to clarify its supervisory approach to consolidation projects involving euro area banks. With the guide the ECB intends to clarify, within the current regulatory framework, the principles underpinning the prudential supervisory approach it follows when determining whether the arrangements implemented … Continue Reading

EBA discussion paper on BRRD early intervention measures

On 26 June 2020, the European Banking Authority (EBA) published a discussion paper on the application of early intervention measures (EIMs) in the EU under the Bank Recovery and Resolution Directive (BRRD). The first part of the discussion paper discusses the results of a survey on the application of the EIMs that the EBA conducted … Continue Reading

FSB evaluation finds too-big-to-fail reforms made banks more resilient and resolvable, but gaps need to be addressed

On 28 June 2020, the Financial Stability Board (FSB) published for public consultation an evaluation of too-big-to-fail (TBTF) reforms for systemically important banks. The consultation report finds that the TBTF reforms have contributed to the resilience of the global banking sector and its ability to absorb, rather than amplify, shocks. Major banks are much better … Continue Reading

COVID-19: European legislators approve CRR “quick fix”

On 18 June 2020 the European Parliament adopted its legislative report on the targeted amendments to the Capital Requirements Regulation (CRR “quick fix”). The Parliament’s position reflects a compromise agreed with Member States in informal negotiations that preceded the vote. This paves a way for a formal adoption, publication in the EU Official Journal and … Continue Reading

EBA report on the peer review of DGS stress tests and resilience

On 17 June 2020, the European Banking Authority (EBA) published its first peer review of stress tests and the resilience of deposit guarantee schemes (DGSs). The review assessed the results of 135 DGS stress tests performed by 32 DGSs from 27 EU Member States. The Deposit Guarantee Schemes Directive (DGSD) requires Member States to ‘ensure … Continue Reading

EBA report on convergence of supervisory practices in 2019

On 29 May 2020, the European Banking Authority (EBA) published a report on convergence of supervisory practices in 2019. Overall, the report finds that the key topics for supervisory attention identified in the EBA 2019 convergence plan have been largely implemented in supervisory work across the EU. The report is part of the EBA’s work … Continue Reading

EBA guidelines on loan origination and monitoring

On 29 May 2020, the European Banking Authority (EBA) published guidelines on loan origination and monitoring that expect institutions to develop robust and prudent standards to ensure newly originated loans are assessed properly. The guidelines also aim to ensure that institutions’ practices are aligned with consumer protection rules and respect fair treatment of consumers. To … Continue Reading

ESMA updates Q&As on the Securitisation Regulation

 On 28 May 2020, the European Securities and Markets Authority (ESMA) updated its Q&As on the Securitisation Regulation. Most of the new Q&As provide clarification on the different aspects of the templates contained in the draft technical standards on disclosure which are published on the European Commission’s website. In particular, ESMA clarifies how several specific … Continue Reading

COVID-19 is placing unprecedented challenges on EU banks

On 25 May 2020, the European Banking Authority (EBA) published a preliminary assessment of the impact of COVID-19 on the EU banking sector. The EBA reports that the COVID-19 pandemic is expected to affect asset quality and therefore the profitability of banks going forward. However, it also notes that the capital accumulated by banks during … Continue Reading

EBA report on interlinkages between recovery and resolution planning

On 20 May 2020, the European Banking Authority (EBA) published a report, which assesses interlinkages between recovery and resolution planning under the Bank Recovery and Resolution Directive (BRRD), with the aim of enhancing synergies between the two phases and ensuring consistency in their potential implementation. The report: outlines the EBA’s observations deriving from its first … Continue Reading

EBA consults on technical standards for contractual recognition of stay powers under the BRRD

On 15 May 2020, the European Banking Authority (EBA) issued a consultation on draft regulatory technical standards (RTS) for contractual recognition of stay powers laid down in the Bank Recovery and Resolution Directive (BRRD). The draft RTS are made under Article 71a(5) of the BRRD, which requires the EBA to develop RTS to further determine … Continue Reading

Updated EBA guidelines on the equivalence of confidentiality regimes

On 15 April 2020, the European Banking Authority (EBA) updated its guidelines on the equivalence of confidentiality and professional secrecy regimes by adding the New York State Department of Financial Services (United States) to the current list of non-EU (third country) supervisory authorities whose confidentiality regimes can be regarded as equivalent. The EBA guidelines are … Continue Reading

Coronavirus/COVID-19: German regulator on conduct of business rules

After the European Securities and Markets Authority (ESMA) had issued a public statement regarding the application of MiFID II requirements on the recording of telephone conversations on 20 March 2020 (see the related publication in our blog), the German Federal Financial Supervisory Authority (Bundesanstalt für Finanzdienstleistungsaufsicht – BaFin) published additional guidance to market participants on the same … Continue Reading

Coronavirus/COVID-19: German regulator grants temporary relief for supervised entities (update)

After having taken initial steps to deal with the impact of the COVID-19 pandemic on the financial sector in Germany (see the related publication in our blog), the German Federal Financial Supervisory Authority (Bundesanstalt für Finanzdienstleistungsaufsicht – BaFin) has taken further relief measures. In order to give supervised entities a better overview of these measures, … Continue Reading

ICMA and ISLA ask ESMA to delay SFTR reporting go-live date

On 18 March 2020, the International Capital Markets Association (ICMA) and the International Securities Lending Association (ISLA) published a letter sent to the European Securities and Markets Authority (ESMA) asking for a delay to the upcoming application of reporting obligations under the Securities Financing Transactions Regulation ((EU) 2015/2365) (SFTR). Under Article 4 of the SFTR, … Continue Reading

Coronavirus/COVID-19: German regulator grants temporary relief for supervised entities

After having stated that it will closely monitor the risk situation caused by the new coronavirus (SARS-CoV-2) with a view to potential reactions, the German Federal Financial Supervisory Authority (Bundesanstalt für Finanzdienstleistungsaufsicht – BaFin) has now taken initial steps to deal with the impact of the pandemic on the financial sector in Germany. Relief for … Continue Reading

EBA releases final chapter of handbook on valuation for purposes of resolution under BRRD

On 10 March 2020, the European Banking Authority (EBA) published a new chapter of its Handbook on valuation for the purposes of resolution. The new chapter replaces chapter 10 relating to management information systems. The new chapter deals with resolution authorities’ assessment, in the context of the resolvability assessment, of the institutions’ capability to swiftly … Continue Reading

EBA issues updated list of validation rules

On 10 March 2020, the European Banking Authority issued a revised list of validation rules in its Implementing Technical Standards (ITS) on supervisory reporting, highlighting those which have been deactivated either for incorrectness or for triggering IT problems. Member State competent authorities throughout the EU are informed that data submitted in accordance with these ITS … Continue Reading

EBA launches consultation to update identification methodology for G-SIIS

On 5 March 2020, the European Banking Authority (EBA) published a consultation to update the identification methodology of global systemically important institutions (G-SIIs) and related capital buffer rates. The consultation follows the Basel Committee on Banking Supervision updating its approach to identify global systemically important banks in July 2018. The EBA methodology closely follows the … Continue Reading

Basel Committee meets to review vulnerabilities and emerging risks

On 27 February 2020, the Basel Committee on Banking Supervision issued a press release concerning its meeting on 26-27 February 2020. Among other things the press release notes that the Basel Committee discussed the financial stability implications of the coronavirus  outbreak (Covid-19) for the banking system and exchanged information on the business continuity measures that … Continue Reading
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