The European Banking Authority (EBA) has published an opinion on the design and calibration of a new prudential framework for investment firms, which is tailored to the needs of their different business models and inherent risks.

The opinion is in response to the European Commission’s call for advice of 13 June 2016 on the design of a new prudential framework for those MiFID investment firms for which the current prudential regime of the Capital Requirements Directive IV (CRD IV) and the Capital Requirements Regulation (CRR) is not appropriate.

The opinion covers the design and calibration of capital and liquidity requirements, consolidated supervision, reporting requirements, the suitability of the proposed framework for commodity derivatives firms and the need of macro-prudential tools. The opinion also contains recommendations concerning the applicability of the remuneration requirements and corporate governance rules to investment firms laid down in the CRD IV and CRR. Furthermore, recommendations are included in the opinion for the introduction of very simple prudential requirements and corporate governance rules to investment firms laid down in the CRD IV and CRR.

View EBA issues opinion on the design of anew prudential framework for investment firms, 29 September 2017