The COVID-19 pandemic is continuing to present challenges across the board with regional lockdowns, closures of “air-bridges” and talks of a second wave dominating media outlets at the present time. If the pandemic has brought certainty in one regard, it is that the future is more uncertain than ever. In order to help provide further … Continue Reading
On 28 June 2020, the PRA issued a statement providing guidance to all PRA-regulated firms on the EBA guidelines on Covid-19 disclosures and published PRA disclosure templates. On disclosure templates, the PRA notes that its letters dated 26 March 2020 from Sam Woods ‘Covid-19: IFRS 9, Capital requirements and loan covenants’ and 4 June 2020 … Continue Reading
On 28 July 2020, the PRA announced that it would undertake an assessment of firms’ distribution plans beyond the end of 2020 in Quarter 4 2020. The assessment will be based on the current and projected capital positions of the banks and will take into account the level of uncertainty on the future path of … Continue Reading
On 28 July 2020, the European Central Bank (ECB) published the aggregate results of its vulnerability analysis of banks directly supervised within the Single Supervisory Mechanism. The exercise assessed how the economic shock caused by the COVID-19 pandemic would impact 86 euro area banks and aimed to identify potential vulnerabilities within the banking sector over … Continue Reading
On 28 July 2020, the European Central Bank (ECB) extended its recommendation that banks not pay dividends nor buy back shares until January 2021. The ECB has also asked banks to be “extremely moderate” with regard to variable remuneration. The ECB also encourages banks to use their capital and liquidity buffers for lending purposes and … Continue Reading
On 15 July 2020, the FCA updated the temporary guidance that it had produced in respect of the COVID-19 pandemic for firms providing motor finance, buy-now pay-later (BNPL), rent-to-own (RTO), pawnbroking and high-cost short-term credit (HCSTC) products. The temporary guidance was originally published on 24 April 2020. On 3 July 2020, the FCA announced that … Continue Reading
On 6 July 2020, the FCA updated its statement on the open access regime for the trading and clearing of exchange-traded derivatives by adding the following paragraph: “Since we published the statement below, the EU co-legislators agreed that considering the adverse circumstances arising from the COVID-19 pandemic it was appropriate to amend MiFIR to give … Continue Reading
On 7 July 2020, the European Banking Authority (EBA) published a report providing clarification on certain issues concerning the application of the prudential framework that have been raised as a consequence of the COVID-19 pandemic. Specifically the report is intended to provide clarity on the implementation of the EBA guidelines on legislative and non-legislative moratoria … Continue Reading
On 25 June 2020, the FCA updated its webpage concerning trade repositories (TRs). The web page covers the following topics: Getting registered under UK EMIR. Getting registered under UK SFTR. What TRs should do now. Application to convert ESMA EMIR or ESMA SFTR registration. Application to register a new UK legal entity and enter the … Continue Reading
On 26 June 2020, the PRA updated its statement on the regulatory treatment of the UK Coronavirus Business Interruption Loan Scheme (CBILS) and the UK Coronavirus Large Business Interruption Loan Scheme (CLBILS). The update provides clarification for firms using the: standardised approach for exposures to the obligor. The PRA explains that the portion of an … Continue Reading
On 26 June 2020, the PRA issued a statement on its website concerning COVID-19 regulatory reporting and disclosure amendments. The PRA statement provides that having considered the fact that firms have now had time to adjust to new ways of working, and the prudential benefits to supervisors of timely submission of regulatory data, the PRA … Continue Reading
On 26 June 2020, there was published in the Official Journal of the EU (OJ), a Regulation making targeted amendments to the Capital Requirements Regulation (CRR) and the revised Capital Requirements Regulation (CRR2) (CRR “quick fix”). The “quick fix” legislation has been intended to help credit institutions to mitigate the impact of the COVID-19 outbreak … Continue Reading
On 26 June 2020, the FCA updated its web page, Regulatory reporting – changes to regulatory reporting during COVID-19. The update explains that following its original announcement of 22 April 2020, the FCA will continue to be flexible in relation to submission deadlines for those regulatory returns mentioned on the web page. For such returns, … Continue Reading
On 25 June 2020, there was published in the Official Journal of the EU (OJ), Commission Delegated Regulation (EU) 2020/866 of 28 May 2020 amending Delegated Regulation (EU) 2016/1010 supplementing the Capital Requirements Regulation (CRR) with regard to regulatory technical standards for prudent valuation under Article 105(14) of the CRR. The Commission Delegated Regulation was … Continue Reading
On 24 June 2020, the PRA issued a statement regarding the European Banking Authority (EBA) guidelines to address gaps in reporting data and public information in the context of COVID-19 (EBA guidelines). The PRA states that it does not consider it necessary at this time to extend the supervisory reporting elements of the EBA guidelines. … Continue Reading
Many companies have made significant donations of funds, goods and services as part of international relief efforts. These efforts are of course to be applauded, but it is important to be mindful of the bribery and corruption risks presented by charitable donations, particularly in emerging markets, and to take proactive steps to manage legal and … Continue Reading
On 19 June 2020, the FCA issued a new web page concerning proposed guidance to provide continued support for users of certain consumer credit products, who are facing a financial impact because of the exceptional circumstances arising from coronavirus. Specifically, the proposals outline the support firms would be expected to provide credit card and other … Continue Reading
On 16 June 2020, the FCA updated its web page providing guidance to firms as regards mortgages and customers who are in financial difficulties due to the COVID-19 pandemic. The FCA originally published the guidance on 20 March 2020 and it was updated on 4 June and now on 16 June 2020. Unless renewed or … Continue Reading
Businesses have been working very hard to respond to, and deal with, the evolving impacts of Covid-19. The crisis has affected companies in a range of different ways across the spectrum – their governance, culture, sales processes, customer servicing and how they deal with customers that are less resilient, vulnerable and in financial difficulty. All … Continue Reading
The FCA has finalised guidance on what it believes insurers and insurance intermediaries should be doing to identify issues relating to COVID-19 that affect the value of insurance products. The guidance is intended to highlight areas where firms might prioritise product reviews in light of the pandemic. The FCA expects firms to consider how the … Continue Reading
On 10 June 2020, the FCA announced on its website that it had started proceedings in the High Court to resolve uncertainty over the validity of business interruption insurance claims. The test case in which the FCA is claimant and several insurance companies are defendants is brought pursuant to the Financial Markets Test Case Scheme. … Continue Reading
On 8 June 2020, the Bank of England (BoE) and the PRA issued a short statement noting the recommendation made by the European Systemic Risk Board on the restriction of distributions during the COVID-19 pandemic. In the context of the UK’s withdrawal from the EU, this recommendation applies to UK authorities during the transition period. … Continue Reading
On 8 June 2020, the General Board of the European Systemic Risk Board (ESRB) agreed to a second set of actions to address the challenges stemming from the COVID-19 pandemic. These macro-prudential actions refer to the five priority areas previously identified by the ESRB: Implications for the financial system of guarantee schemes and other fiscal … Continue Reading
Regulatory, insolvency and accounting perspectives The COVID-19 pandemic is having a severe impact on many business sectors, and financial institutions are no exception. Many firms are likely to encounter challenges of one form or another in coming months, as countries emerge from lockdown and seek to resume normal business at different times, and the applicable … Continue Reading
