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Topic: Banking

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Basel Committee approves annual G-SIBs assessment, updates workplan to evaluate post-crisis reforms

On 25 September 2020, the Basel Committee on Banking Supervision (Basel Committee) issued a press statement following its meeting on 14, 18 and 25 September 2020 to take stock of COVID-19 risks to the global banking system and related vulnerabilities. Key points in the press statement include: The Basel Committee reiterates its previous guidance that … Continue Reading

EBA launches 2020 transparency exercise

On 25 September 2020, the European Banking Authority (EBA) launched its 7th annual EU-wide transparency exercise, with the objective of providing market participants with updated information on the financial conditions of EU banks as of June 2020, thus assessing the preliminary impact of the COVID-19 crisis on the sector. The EBA expects to publish the … Continue Reading

EBA phases out its guidelines on legislative and non-legislative loan repayments moratoria

On 21 September 2020, the European Banking Authority (EBA) announced that it will phase out its guidelines on legislative and non-legislative payment moratoria in accordance with its end of September deadline. The EBA guidelines on legislative and non-legislative loan repayments moratoria were published on 2 April 2020 to ensure that EU banks, while maintaining comparable … Continue Reading

FCA finalises guidance on branch and ATM closures or conversions

On 14 September 2020, the FCA published Finalised Guidance 20/3: Branch and ATM closures or conversions (FG20/3). FG20/3 applies to regulated firms that operate (or have agents operate) branches, or ATMs (cash machine or cashpoint), and who are subject to Principles 6, 7 and 11 of the Principles for Businesses. It applies when such a … Continue Reading

Securitisation Regulation – Implementing and Delegated Regulations published in the OJ

On 3 September 2020, the following Level 2 measures for the Securitisation Regulation were published in the Official Journal of the EU (OJ): Commission Implementing Regulation (EU) 2020/1227 of 12 November 2019 laying down implementing technical standards with regard to templates for the provision of information in accordance with the simple, transparent and standardised (STS) … Continue Reading

PRA Dear CEO letter: Temporary Permissions Regime – Operational Readiness

On 1 September 2020, the Prudential Regulation Authority (PRA) published a Dear CEO letter from Sam Woods, Deputy Governor and CEO of the PRA to remind firms to be operationally ready for the Temporary Permissions Regime (TPR). The TPR is due take effect at 11pm on Thursday 31 December 2020, which is the point at … Continue Reading

Delegated Regulation on CCP colleges under EMIR 2.2 adopted by European Commission

On 1 September 2020, the European Commission adopted a Delegated Regulation (C(2020) 5888 final) containing draft regulatory technical standards (RTS) for central counterparty colleges under EMIR 2.2. The draft RTS amends Commission Delegated Regulation 876/2013 (RTS on central counterparty colleges) and reflect the changes to Article 18(6) of EMIR (648/2012) introduced by EMIR 2.2 on … Continue Reading

New Bank of England webpage on the Temporary Permissions Regime

On 1 September 2020, the Bank of England (BoE) published a new webpage, which summarises its approach to the Temporary Permissions Regime (TPR). On this new webpage the BoE has confirmed the following: Firms that have submitted a valid Notification or Part 4A application (and not withdrawn) will automatically enter the TPR. Where a firm … Continue Reading

EBA publish opinion on European Commission’s amendments relating to the final draft RTSs on the specification of the nature, severity and duration of an economic downturn under Articles 181(3)(a) and 182(4)(b) of the Capital Requirements Regulation

On 31 August 2020, the EBA published an opinion (EBA/Op/2020/12) on the European Commission’s amendments relating to the EBA’s final draft regulatory technical standards (RTS) on the specification of the nature, severity and duration of an economic downturn under Articles 181(3)(a) and 182(4)(b) of the Capital Requirements Regulation (575/2013). On 5 November 2018, the EBA … Continue Reading

COVID-19: PRA ends temporary approach to value-at-risk back-testing exceptions

On 27 August 2020, the Prudential Regulation Authority (PRA) published a statement setting out its decision to terminate its temporary approach to value-at-risk (VAR) back-testing exceptions from 30 September 2020. This statement follows the PRA’s review of the temporary approach that allowed firms to offset increases due to new back-testing exceptions through a commensurate reduction … Continue Reading

PRA statement on Covid-19: IFRS 9 and capital requirements

On 26 August, the PRA published a statement on IFRS9 and capital requirements, in light of the imminent conclusion of mortgage payment deferrals. The PRA’s earlier guidance, issued by way of letter to authorised firms on 3 March and 4 June, explained that, under the terms of the FCA’s guidance then in place, Covid-19 related … Continue Reading

The Sustainable Finance Regulation Video Series

Volume 1: Foreign Banks Operating in the UK Over the next few months, Norton Rose Fulbright’s financial services conduct team will be releasing a series of videos focussing on sustainable finance regulation issues affecting financial services firms. In volume 1 of the series, Hannah McAslan discusses the sustainable finance regulation issues impacting on foreign banks … Continue Reading

EBA updates data for the global systemically important institutions (G-SIIs) for the 2019 period

On 20 August, the European Banking Authority (EBA) updated data relating to the 37 largest institutions in the EU whose leverage ratios exceed EUR 200 billion. This in turn will be used to identify a smaller group of banks which are considered to be global systemically important institutions (G-SIIs). This is the first year that … Continue Reading

ECB banking supervision – report on banks’ ICAAP practices

On 11 August 2020, the European Central Bank (ECB) published a report on banks’ ICAAP practices. The internal capital adequacy assessment process (ICAAP) has been and remains one of ECB banking supervision’s top supervisory priorities since they were first published in 2016. The report summarises the results of a structured analysis of ICAAP practices, describing … Continue Reading

PRA letter: Building Societies Sourcebook: Fixed rate lending guidelines

On 11 August 2020, the PRA published a letter (dated 31 July 2020) from Mel Beaman, Director UK deposit takers, PRA to CEOs of non-systemic building societies. The letter was in response to a Building Societies Association suggestion proposing a six-month suspension of the relevant guidance levels on fixed rate lending limits in the Building … Continue Reading

SRB publishes guidance documents for bail-in operationalisation

On 10 August 2020, the Single Resolution Board (SRB) published the following documents designed to give banks within its remit operational guidance on the implementation of the bail-in tool: Q&A for publication of bail-in guidance. The Q&A explains that the bail-in playbook is an internal document of banks, establishing a minimum set of objectives, processes … Continue Reading

Financial Services Compensation Scheme – Temporary High Balance Coverage Extension

On 5 August 2020, the PRA published Policy Statement 19/20: Financial Services Compensation Scheme – Temporary High Balances Coverage Extension (PS19/20). In PS19/20 the PRA provides feedback to responses to Consultation Paper 6/20: Financial Services Compensation Scheme – Temporary High Balances Coverage Extension (CP6/20). It also includes final policy in the form of amendments to … Continue Reading

EBA updates on 2021 EU-wide stress test timeline, sample and potential future changes to its framework

On 30 July 2020, the European Banking Authority announced that it had agreed on the tentative timeline and sample of the 2021 EU-wide stress test. The stress test will be carried out at the highest level of consolidation on a sample of 51 banks, of which 39 will be from the Euro Area, covering broadly … Continue Reading

SRB operational guidance for operational continuity in resolution and FMI contingency plans

On 29 July 2020, the Single Resolution Board (SRB) published operational guidance on operational continuity in resolution (OCIR) and on financial market infrastructure (FMI) contingency plans. The guidance on OCIR provides further clarifications to banks on how to implement SRB expectations related to service identification and mapping, assessment of operational continuity risk, mitigating measures such … Continue Reading

EBA consults on technical standards on reporting of MREL decisions

On 23 July 2020, the European Banking Authority (EBA) issued a public consultation on draft Implementing Technical Standards (ITS) specifying uniform reporting templates, instructions and methodology for the identification and transmission, by Member State resolution authorities to the EBA, of information on minimum requirements for own funds and eligible liabilities (MREL). The BRRD has been … Continue Reading

EBA consults on estimation of Pillar 2 and combined buffer requirements for the purpose of setting MREL

On 23 July 2020, the European Banking Authority (EBA) issued a public consultation on its draft Regulatory Technical Standards (RTS) specifying the methodology to be used by Member State resolution authorities to estimate the Pillar 2 (P2R) and combined buffer requirements (CBR)  at resolution group level for the purpose of setting the minimum requirement for … Continue Reading

EBA consults on technical standards on impracticability of contractual recognition of bail-in

On 23 July 2020, the European Banking Authority (EBA) issued a public consultation on draft Regulatory Technical Standards (RTS) and draft Implementing Technical Standards (ITS) on the impracticality of contractual recognition of write-down and conversion powers and related notifications as laid down in the Bank Recovery and Resolution Directive (BRRD). The statutory background to the … Continue Reading

Simplified Obligations for recovery planning

On 23 July 2020, the PRA published Consultation Paper 10/20: Simplified Obligations for recovery planning (CP10/20). In CP10/20 the PRA sets out a proposal to allow certain firms to benefit from Simplified Obligations for recovery planning (Simplified Obligations), in light of the discretion it has under Article 4(1) of the Bank Recovery and Resolution Directive … Continue Reading
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