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Topic: Capital Adequacy

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EBA draft principles assessing the representativeness of COVID-19-impacted data for banks using IRB models

On 21 June 2022, the European Banking Authority (EBA) published four draft principles to support supervisory efforts in assessing the representativeness of COVID-19–impacted data for banks, using internal ratings based (IRB) models. These principles will be part of a supervisory handbook, which the EBA will publish later this year, with the objective to ensure a … Continue Reading

Published in OJ: Commission Delegated Regulation (EU) 2022/954 of 12 May 2022 amending the RTS laid down in Delegated Regulation (EU) No 183/2014

On 21 June 2022, there was published in the Official Journal of the EU (OJ), Commission Delegated Regulation (EU) 2022/954 of 12 May 2022 amending the regulatory technical standards laid down in Delegated Regulation (EU) No 183/2014 as regards the specification of the calculation of specific and general credit risk adjustments. The Delegated Regulation adds … Continue Reading

CRR related Delegated Regulations

On 14 June 2022, the European Commission adopted a Delegated Regulation supplementing the Capital Requirements Regulation (CRR) with regard to regulatory technical standards (RTS) specifying the criteria for assessing the modellability of risk factors under the internal model approach (IMA) and specifying the frequency of that assessment under Article 325be(3) of that Regulation. The draft … Continue Reading

Commission Delegated Regulation supplementing the CRD IV with regard to RTS specifying the information to be provided by an undertaking in the application for authorisation

On 10 June 2022, the European Commission adopted a Delegated Regulation supplementing the CRD IV with regard to regulatory technical standards (RTS) specifying the information to be provided by an undertaking in the application for authorisation in accordance with Article 8a of that Directive. The Council of the EU and the European Parliament will now … Continue Reading

EBA consults on technical standards on the identification of a group of connected clients

On 8 June 2022, the European Banking Authority (EBA) launched a public consultation on draft regulatory technical standards (RTS) on the identification of a group of connected clients (GCC). The definition of group of connected clients in the CRR provides for the identification of two or more natural or legal persons who are so closely … Continue Reading

European Parliament draft reports

On 30 May 2022, the European Parliament published draft reports on: The proposal for a Regulation amending the Capital Requirements Regulation as regards requirements for credit risk, credit valuation adjustment risk, operational risk, market risk and the output floor. The proposal for a Directive amending the Capital Requirements Directive IV as regards supervisory powers, sanctions, … Continue Reading

Basel Committee finalises principals on climate-related financial risks and progresses work on specifying crypto-assets’ prudential treatment

On 27 May 2022, the Basel Committee met and approved a finalised set of principles for the effective management and supervision of climate-related financial risks. The Committee also progressed work on specifying crypto-asset prudential treatment and issuing a second consultation paper. Additionally, the Committee finalised the review of the treatment of cross-border exposures within the … Continue Reading

EBA final draft RTS to identify shadow banking entities

On 23 May 2022, the European Banking Authority (EBA) published a final report containing draft regulatory technical standards (RTS), specifying the criteria to identify shadow banking entities for the purposes of reporting large exposures. The final draft RTS, which have been prepared in accordance with Article 394(4) of the Capital Requirements Regulation (CRR),  clarify that … Continue Reading

Delegated Regulation amending Commission Delegated Regulation 2015/61 supplementing the CRR with regard to the liquidity coverage requirement for credit institutions

On 20 May 2022, there was published in the Official Journal of the EU, Commission Delegated Regulation (EU) 2022/786 of 10 February 2022 amending Commission Delegated Regulation 2015/61 supplementing the Capital Requirements Regulation (CRR) with regard to the liquidity coverage requirement for credit institutions. Commission Delegated Regulation 2015/61 (LCR Delegated Regulation) is applicable to all … Continue Reading

Commission adopts Delegated Regulation amending RTS on the specification of the calculation of specific and general credit risk adjustments

On 12 May 2022, the European Commission adopted a Delegated Regulation amending the regulatory technical standards (RTS) laid down in Delegated Regulation (EU) No 183/2014, as regards the specification of the calculation of specific and general credit risk adjustment. The Delegated Regulation is intended to address an anomaly regarding the sale of defaulted exposures, where … Continue Reading

EBA consults on standardized information requirements to support sales of non-performing loans

On 16 May 2022, the European Banking Authority (EBA) issued a consultation regarding draft implementing technical standards (ITS) specifying the templates to be used by credit institutions for the provision of information to credit purchasers when selling or transferring non-performing loans (NPLs) for the purposes of financial due diligence and valuation of NPLs. The data … Continue Reading

EBA updates technical standards in view of its 2023 benchmarking of internal approaches

On 5 May 2022, the European Banking Authority (EBA) updated its Implementing Technical Standards (ITS) that specify the data collection for the supervisory benchmarking exercise of 2023 in relation to the internal approaches used in market and credit risk and IFRS 9 accounting. The updated ITS include all benchmarking portfolios and metrics that will be … Continue Reading

EBA launches discussion on the role of environmental risks in the prudential framework

On 3 May 2022, the European Banking Authority (EBA) issued a Discussion Paper on the role of environmental risks in the prudential framework for credit institutions and investment firms. The Discussion Paper initiates the discussion on the appropriateness of the current EU prudential framework to address environmental risk drivers and considers the potential justification for … Continue Reading

EBA proposes to simplify and improve the macro-prudential framework

On 29 April 2022, the European Banking Authority (EBA) issued its response to the European Commission’s call for advice on the review of the macro-prudential framework. Article 513 of the Capital Requirements Regulation (CRR) requires the Commission to complete a review of the macro-prudential provisions in the CRR and Capital Requirements Directive IV (CRD IV) … Continue Reading

Recommendation of the ESRB amending Recommendation on the assessment of cross-border effects of and voluntary reciprocity for macro-prudential policy measures

On 28 April 2022, there was published in the Official Journal of the EU the Recommendation of the European Systemic Risk Board (ESRB) of 16 February 2022 amending Recommendation ESRB/2015/2 on the assessment of cross-border effects of and voluntary reciprocity for macro-prudential policy measures. The framework on voluntary reciprocity for macro-prudential policy measures set out … Continue Reading

Published in OJ – Delegated Regulation on RTS on methods of prudential consolidation under CRR

On 26 April 2022, there was published in the Official Journal of the EU, Commission Delegated Regulation (EU) 2022/676 of 3 December 2021 supplementing the Capital Requirements Regulation with regard to regulatory technical standards specifying the conditions in accordance with which consolidation is to be carried out in the cases referred to in Article 18(3) … Continue Reading

IFR – RTS for own funds requirement for investment firms based on fixed overheads

On 25 April 2022, the European Commission published the text of Commission Delegated Regulation (EU) of 11 April 2022 supplementing the Investment Firm Regulation with regard to regulatory technical standards (RTS) for own funds requirement for investment firms based on fixed overheads. The draft RTS: Specify the deductions to be applied for the calculation from … Continue Reading

Published in OJ – Commission Implementing Regulation (EU) 2022/631 of 13 April 2022

On 19 April 2022, there was published in the Official Journal of the EU (OJ) Commission Implementing Regulation (EU) 2022/631 of 13 April 2022 amending the implementing technical standards laid down in Implementing Regulation (EU) 2021/637 as regards to the disclosure of exposures to interest rate risk on positions not held in the trading book. … Continue Reading

Corrigendum to Commission Delegated Regulation of 10 February 2022 amending Commission Delegated Regulation (EU) 2015/61

On 12 April 2022, the Council of the EU published a corrigendum to Commission Delegated Regulation of 10 February 2022 amending Commission Delegated Regulation (EU) 2015/61 to supplement the Capital Requirements Regulation with regard to the liquidity coverage requirement for credit institutions. The main purpose of the Delegated Regulation of 10 February 2022 is to … Continue Reading

ECON Committee discusses on CRR III and CRD VI proposals

On 20 April 2022, the European Parliament’s Economic and Monetary Affairs (ECON) Committee held its first exchange of views on the European Commission’s (Commission) legislative package on the implementation of the final Basel III standards. The legislative package includes: A Commission proposal for a Regulation amending the Capital Requirements Regulation (CRR) Regulation (EU) No 575/2013 … Continue Reading

EBA survey for banks on the application of the infrastructure supporting factor

On 5 April 2022, the European Banking Authority (EBA) launched a survey for banks on their experiences with the application of the so-called infrastructure supporting factor in accordance with the Capital Requirements Regulation (CRR 2). The survey also aims to provide information on the materiality of infrastructure project loans across EU banks, irrespective of whether … Continue Reading

Council of the EU: Daisy Chain Regulation – Three-column table to commence trilogues

On 1 April 2022, the Council of the EU published a three-column table to commence trilogues on the proposed Regulation as regards the prudential treatment of global systemically important institution groups (G-SII groups) with multiple point of entry resolution strategy and a methodology for the indirect subscription of instruments eligible for meeting the minimum requirement … Continue Reading

ESRB concept note ‘Review of the EU Macroprudential Framework for the Banking Sector’

On 31 March 2022, the European Systemic Risk Board (ESRB) published a concept note ‘Review of the EU Macroprudential Framework for the Banking Sector’. In the concept note the ESRB proposes enhancements to the existing EU macroprudential framework for the banking sector for the next decade. Table 1 in the concept note provides an overview … Continue Reading

ECB opinion on a proposal for amendments to the CRR as regards requirements for credit risk, credit valuation adjustment risk, operational risk, market risk and the output floor

On 24 March 2022, the European Central Bank (ECB) published an opinion on a proposal for a Regulation amending the Capital Requirements Regulation (CRR) as regards requirements for credit risk, credit valuation adjustment risk, operational risk, market risk and the output floor. The ECB has published this opinion following requests from the European Parliament and … Continue Reading
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