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Topic: Banking

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European Commission proposes to boost the EU’s financial and economic system

On 19 January 2021, the European Commission published a Communication on the European economic and financial system: fostering openness, strength and resilience . The Communication and strategy set out therein for development of the European financial markets is designed as one of the early steps of the Commission under Ursula von der Leyen’s leadership to … Continue Reading

ECA special report – Resolution planning in the SRM

On 15 January 2021, the European Court of Auditors (ECA) published a special report on resolution planning in the Single Resolution Mechanism (SRM).   In 2017, the ECA conducted its first audit report assessing whether the Single Resolution Board (SRB) was equipped to carry out the resolution of significant banks effectively. To inform policymakers and … Continue Reading

Non-performing loans: vote on EU rules for selling NPLs to third parties

On 14 January 2021, the European Parliament announced that its Economic and Monetary Affairs Committee (ECON) had agreed on the text of the draft Directive on credit servicers, credit purchasers and the recovery of collateral. The ECON MEPs have also agreed to start negotiations with the Council and the European Commission on the draft text. … Continue Reading

ECB finalises guide on supervisory approach to consolidation

On 12 January 2021, the European Central Bank (ECB) published a final guide outlining its supervisory approach to consolidation in the banking sector, following a public consultation which ended on 1 October 2020. The ECB has also published a feedback statement setting out its views on respondents’ comments on the consultation. With the final guide, … Continue Reading

EBA provides additional clarity on the implementation of selected COVID-19 policies

On 21 December 2020, the European Banking Authority (EBA) updated its report on the implementation of selected COVID-19 policies. The report was first published on 7 July 2020 and then updated on 7 August 2020 to provide additional clarity on the implementation of the reporting and disclosure framework in the context of the COVID-19 measures. … Continue Reading

ESMA guidelines – Reporting under Articles 4 and 12 SFTR

On 21 December 2020, the European Securities and Markets Authority (ESMA) published guidelines concerning the securities financing transaction (SFT) reporting obligation as provided in Article 4 Securities Financing Transaction Regulation (SFTR), the trade repositories’ (TRs) obligations under Articles 5(7) and 12 SFTR, as well as the reporting start date as determined in Article 33(2) SFTR. … Continue Reading

SRB issues update on permission regime for the reduction of eligible liabilities

On 18 December 2020, the Single Resolution Board (SRB) updated its approach to the prior permission regime for early calling, redeeming, repaying or repurchasing of eligible liabilities’ instruments by Eurozone banks. From 28 December 2020, the statutory transition period begins under the Single Resolution Mechanism Regulation II (SRMR 2) and authorisation to perform early redemption … Continue Reading

EBA final report on draft RTS on the contractual recognition of stay powers

On 16 December 2020, the European Banking Authority (EBA) published a final report containing that draft regulatory technical standards (RTS) that it is mandated to develop under Article 71a(5) of the Bank Recovery and Resolution Directive (BRRD). Article 71a(5) of the BRRD requires the EBA to develop draft RTS in order to determine the contents … Continue Reading

SRB publishes its final valuation data set

On 11 December 2020, the Single Resolution Board (SRB) published its valuation data set comprising of the following documents: SRB valuation data set instructions document, developing the SRB valuation data set and establishing clear expectations in relation to data needs. An explanatory note providing guidance to Eurozone banks regarding their management information system capabilities to … Continue Reading

SRB publishes guidance on bank mergers and acquisitions

On 7 December 2020, the Single Resolution Board (SRB) published a paper outlining its expectations for how banks engaging in mergers and acquisitions (M&As) can ensure resolvability. The SRB has set out the necessary capabilities that banks need to demonstrate to be considered resolvable in its Expectations for Banks document, published in April 2020. In … Continue Reading

Commission Notice relating to the interpretation of certain legal provisions of the revised bank resolution framework in reply to questions raised by Member States’ authorities (second Commission Notice)

On 2 December 2020, there was published in the Official Journal of the EU a Commission Notice relating to the interpretation of certain legal provisions of the revised bank resolution framework in reply to questions raised by Member States’ authorities. In the Notice the Commission answers various questions that Member States’ have raised regarding: The … Continue Reading

The EBA reactivates its guidelines on legislative and non-legislative moratoria

On 2 December 2020, the European Banking Authority (EBA) announced that it was reactivating its guidelines on legislative and non-legislative moratoria. The purpose of the reactivation is to ensure that loans, which have not previously benefitted from payment moratoria, can benefit from them. The guidelines, which apply until 31 March 2021, include additional safeguards against … Continue Reading

Single Resolution Board publishes its 2021-2023 Multi-Annual Programme

On 30 November 2020, the Single Resolution Board (SRB) published its 2021-2023 Multi-Annual Programme, including its Work Programme 2021. Chapter 1 of the document recalls the SRB mission statement, and brings the work of the SRB into the broader economic, policy and regulatory context. Chapter 2 outlines the priorities of the SRB for the next … Continue Reading

FSB highlights need for resolution preparedness

On 18 November 2020, the Financial Stability Board (FSB) published its 2020 Resolution Report. In relation to banks the report notes that global systemically important banks (G-SIBs) are estimated to already meet the final 2022 minimum external total loss absorbing capacity (TLAC) requirement. While disclosure of external TLAC levels by G-SIBs has improved over the … Continue Reading

2020 list of global systemically important banks

On 11 November 2020, the Financial Stability Board (FSB) issued a press release confirming the 2020 list of global systemically important banks (G-SIBs). The list of G-SIBs is based on end-2019 data and the updated assessment methodology published by the Basel Committee on Banking Supervision in July 2013. The overall number of G-SIBs remains 30. … Continue Reading

Banking Union: Review of the bank crisis management and deposit insurance framework

On 11 November 2020, the European Commission published for consultation an initiative to review the EU’s bank crisis management and deposit insurance framework. The review focuses on the three EU legislative texts currently in force – the Bank Recovery and Resolution Directive, the Single Resolution Mechanism Regulation, and the Deposit Guarantee Schemes Directive. The main … Continue Reading

EBA launches consultation on revised guidelines on sound remuneration policies

On 29 October 2020, the European Banking Authority (EBA) issued a public consultation on its guidelines on sound remuneration policies. The consultation proposals take into account the amendments introduced by the Fifth Capital Requirements Directive (CRD V) in relation to institutions’ sound remuneration policies and in particular the requirement that those remuneration policies should be … Continue Reading

PRA hosts IRB mortgage roundtable

On 14 October 2020, the PRA published a new webpage concerning a recent IRB mortgage virtual roundtable it hosted. The roundtable followed the publication of Policy Statement 11/20: Credit risk: Probability of Default and Loss Given Default estimation. During the virtual roundtable the PRA used an internal ratings based model to calculate capital requirements for … Continue Reading

ESMA updates Q&As on securitisation topics and guidelines on portability of information between securitisation repositories

On 5 October 2020, the European Securities and Markets Authority (ESMA) published its final report on the guidelines on portability of information between securitisation repositories under the Securitisation Regulation. The guidelines provide clarification on how to ensure compliance with the obligations in Articles 78(9)(c) and 79(3) of EMIR, as applied by Article 10(2) of the … Continue Reading

EBA work programme 2021

On 30 September 2020, the European Banking Authority (EBA) published its annual work programme for 2021, describing its activities and tasks for the coming year and highlighting key strategic areas of work. In 2021, the EBA will focus on six strategic areas: Supporting the deployment of the risk reduction package and the implementation of effective … Continue Reading

European Commission notice on BRRD II published in OJ

On 29 September 2020, there was published in the Official Journal of the EU a Commission Notice relating to the interpretation of certain legal provisions of the revised bank resolution framework in reply to questions raised by Member States competent authorities (NCAs). The Commission Notice answers certain questions that NCAs have raised on the: Bank … Continue Reading

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
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