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Topic: Capital adequacy

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Commission Implementing Regulation on ITS on public disclosures under CRR published in OJ

On 21 April 2021, there was published in the Official Journal of the EU Commission Implementing Regulation (EU) 2021/637 of 15 March 2021 laying down implementing technical standards with regard to public disclosures by institutions of the information referred to in Titles II and III of Part Eight of Regulation (EU) No 575/2013 of the … Continue Reading

FCA CP21/7 A new UK prudential regime for MiFID investment firms

Introduction On 19 April 2021, the FCA issued the second phase of proposed rules to introduce the UK Investment Firm Prudential Regime (IFPR) by publishing Consultation Paper 21/7: A new UK prudential regime for MiFID investment firms (CP21/7). CP21/7 should be read in conjunction with the FCA’s first consultation paper on the IFPR which it … Continue Reading

EBA final draft technical standards specifying the methods of prudential consolidation

On 15 April 2021, the European Banking Authority (EBA) published final draft regulatory technical standards (RTS) specifying the conditions according to which consolidation shall be carried out in line with Article 18 of the Capital Requirements Regulation (CRR). The draft RTS seek to ensure that the appropriate method of prudential consolidation is applied for the … Continue Reading

Published in OJ – Delegated Regulation on specialised lending exposures under the CRR

On 14 April 2021, there was published in the Official Journal of the EU, Commission Delegated Regulation (EU) 2021/598 of 14 December 2020 supplementing the Capital Requirements Regulation (CRR) with regard to regulatory technical standards (RTS) for assigning risk weights to specialised lending exposures. The Delegated Regulation applies from 14 April 2022. The RTS specify … Continue Reading

PRA CP7/21 ‘Credit risk: The identification of the nature, severity and duration of an economic downturn for the purposes of IRB models’

On 7 April 2021, the PRA published Consultation Paper 7/21 ‘Credit risk: The identification of the nature, severity and duration of an economic downturn for the purposes of Internal Ratings Based (IRB) models’ (CP7/21). The PRA considers that it is important to reduce unwarranted variability from IRB models, and has previously set out its implementation … Continue Reading

EBA consults on the list of advanced economies to determine equity risk under the new market risk regime

On 7 April 2021, the European Banking Authority (EBA) issued a consultation paper regarding draft regulatory technical standards (RTS) on the list of countries with an advanced economy for calculating the equity risk under the alternative standardised approach (FRTB-SA). The Capital Requirements Regulation as amended by Regulation (EU) 2019/876 (CRR) implements in EU legislation the … Continue Reading

EBA consultation on draft RTS on disclosure of investment policy by investment firms

On 31 March 2021, the European Banking Authority (EBA) issued a consultation paper on draft regulatory technical standards (RTS) on disclosure of investment firm policy by investment firms. The legal basis for the consultation paper is Article 52 of the Investment Firms Regulation (IFR) that sets out the requirement for investment firms to disclose information … Continue Reading

Published in OJ – Revised RTS on methodology for the identification of G-SIBs

On 29 March 2021, there was published in the Official Journal of the EU (OJ) Commission Delegated Regulation (EU) 2021/539 of 11 February 2021 amending Delegated Regulation (EU) No 1222/2014 supplementing Directive 2013/36/EU of the European Parliament and of the Council with regard to regulatory technical standards (RTS) for the specification of the methodology for … Continue Reading

Draft statutory instrument – The Capital Requirements Regulation (Amendment) (EU Exit) Regulations 2021

On 25 March 2021, there was published by the Government a draft of the Capital Requirements Regulation (Amendment) (EU Exit) Regulations 2021. When finalised the draft Regulations extend the dates of the provision exempting UK commodities dealers from specific prudential requirements until the Investment Firm Prudential Regime (IFPR) applies to them on 1 January 2022. … Continue Reading

Commission Implementing Regulation laying down ITS on supervisory reporting

On 19 March 2021, there was published in the Official Journal of the EU (OJ) Commission Implementing Regulation (EU) 2021/451 of 17 December 2020 laying down implementing technical standards for the application of Regulation (EU) No 575/2013 of the European Parliament and of the Council with regard to supervisory reporting of institutions and repealing Implementing … Continue Reading

Published in OJ: Commission Implementing Regulation containing ITS on reporting requirements for market risk under CRR

On 16 March 2021, there was published in the Official Journal of the EU Commission Implementing Regulation (EU) 2021/453 of 15 March 2021 laying down implementing technical standards (ITS) for the application of the Capital Requirements Regulation (CRR) with regard to the specific reporting requirements for market risk. The reporting requirements defined in the ITS … Continue Reading

EBA decision on Basel III monitoring exercise

On 16 March 2021, the European Banking Authority published a decision making the Basel III monitoring exercise mandatory from December 2021. The EBA states that the move will expand the sample used for the monitoring exercise therefore making it more representative. Also, the decision provides Member State competent authorities with provisions for a reduced frequency … Continue Reading

EBA releases its annual assessment of the consistency of internal model outcomes for 2020

On 15 March 2021, the European Banking Authority (EBA) published two reports on the consistency of risk weighted assets (RWAs) across all EU institutions authorised to use internal approaches for the calculation of capital requirements for 2020. The reports cover credit risk for high and low default portfolios as well as market risk. The report … Continue Reading

EBA reports on the monitoring of the LCR implementation in the EU

On 15 March 2021, the European Banking Authority (EBA) published a report on the monitoring of liquidity coverage ratio (LCR) implementation in the EU. The report highlights areas in which further guidance is deemed useful for banks and Member State supervisors in order to foster a common understanding and harmonisation of the application of the … Continue Reading

EBA consults on technical elements for the implementation of the alternative standardised approach for market risk as part of its FRTB roadmap

On 12 March 2021, the European Banking Authority (EBA) published consultation papers regarding draft regulatory technical standards (RTS) on: Residual risk add-on (RRAO). Article 430b of the Capital Requirements Regulation (CRR) provides that from the date of application of Commission Delegated Regulation 2021/424 institutions that do not meet the conditions set out in Article 94(1) … Continue Reading

Commission Delegated Regulation amending the CRR with regard to the alternative standardized approach for market risk

On 11 March 2021, there was published in the Official Journal of the EU (OJ), Commission Delegated Regulation 2021/424 of 17 December 2019 amending the Capital Requirements Regulation with regard to the alternative standardised approach for market risk. This Delegated Regulation introduces into the Capital Requirements Regulation the technical specifications needed to make fully operational … Continue Reading

IOSCO reviews implementation of liquidity risk management recommendations and market participants´ responses to COVID-19 induced market stresses

On 5 March 2021, the International Organization of Securities Commissions (IOSCO) launched a thematic review of the 2018 Recommendations for Liquidity Risk Management for Collective Investment Schemes.  The thematic review aims to assess the extent to which the Recommendations have been implemented through IOSCO member regulatory frameworks. It also aims to gather information about how … Continue Reading

EBA issues new supervisory reporting and disclosures framework for investment firms

On 5 March 2021, the European Banking Authority (EBA) published final draft implementing technical standards (ITS) on the supervisory reporting and disclosures of investment firms. The provisions on disclosure are contained in Articles 46 to 53 of the Investment Firm Regulation (IFR). Investment firms are required to disclose their capital resources, capital requirements, remuneration policies, … Continue Reading

Commission Delegated Regulation supplementing the CRR with regard to RTS specifying the nature, severity and duration of an economic downturn referred to in Article 181(1), point (b), and Article182(1), point (b), of that Regulation

On 1 March 2021, the European Commission published a draft Delegated Regulation supplementing the Capital Requirements Regulation with regard to regulatory technical standards (RTS) specifying the nature, severity and duration of an economic downturn referred to in Article 181(1), point (b) and Article 182(1), point (b), of that Regulation. The draft RTS specify the nature, … Continue Reading

PRA and FCA statements on the definition of ‘higher paid material risk taker’

On 25 February 2021, the PRA issued a statement on its website regarding an error it has identified in the Remuneration Part of the PRA Rulebook. The error relates to the ‘higher paid material risk taker’ definition in Rule 1.3 in the Remuneration Part of the PRA Rulebook. The ‘higher paid material risk taker’ definition … Continue Reading

PRA statement on EBA guidelines and EU RTS relating to approaches to credit risk following the end of the transition period

On 25 February 2021, the PRA issued a statement designed to clarify its approach to the published European Banking Authority (EBA) guidelines and EU regulatory technical standards (RTS) relating to the standardised and internal ratings based approaches to credit risk following the end of the transition period. The statement covers the PRA’s approach to the … Continue Reading

EBA consults on draft technical standards to improve supervisory cooperation for investment firms

On 24 February 2021, the European Banking Authority (EBA) issued two public consultations on regulatory technical standards (RTS) and implementing technical standards (ITS) on cooperation and information exchange between Member State competent authorities involved in the prudential supervision of investment firms. The draft standards are part of the phase 2 mandates of the EBA roadmap … Continue Reading

EBA final report on draft RTS for determination of indirect exposures to underlying clients of derivatives and credit default derivatives under CRR

On 19 February 2021, the European Banking Authority (EBA) published a final report containing draft regulatory technical standards (RTS) on the determination of indirect exposures to underlying clients of derivative and credit derivative contracts under Article 390(9) of the Capital Requirements Regulation (CRR). Article 390(5) of the CRR, as amended by Regulation (EU) 2019/876, requires … Continue Reading

EBA publishes final draft technical standards on disclosure of indicators of global systemic importance by G-SIIs

On 18 February 2021, the European Banking Authority (EBA) issued a final report containing final draft Implementing Technical Standards (ITS) on the disclosure of indicators of global systemically important institutions (G-SIIs). The final report has been prepared by the EBA in pursuance to the mandate given to it under Article 434a of the Capital Requirements … Continue Reading
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