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Regulatory updates

We have an ongoing regulatory watch system

Management Solutions compiles new regulations published in recent weeks by different regulatory and supervisory authorities (with a focus on the financial industry).

Relevant publications


Insurance and reinsurance distribution

(22/05/2017) DGSFP – Borrador de Anteproyecto de Ley de distribución de seguros y reaseguros privados
The Dirección General de Seguros y Fondos de Pensiones (DGSFP) has published a second draft Anteproyecto de Ley de distribución de seguros y reaseguros privados, which will transpose the European Directive 2016/97 on insurance distribution. This draft aims to modify the previous law by extending its scope and reinforcing the requirements regarding organization and professional skills, among other aspects.

Leveraged transactions

(17/05/2017) ECB – Guidance on leveraged transactions
The ECB has published a Guidance on leveraged transactions that summarises key supervisory expectations concerning these transactions, and the ongoing monitoring of both syndication risk and the fundamental credit quality of leveraged exposures.

Assessments of members of the management body

(16/05/2017) ECB – Guide to fit and proper assessments
The ECB has published a Guide to fit and proper assessments of members of the management bodies of significant credit institutions, with the objective of explaining in greater detail the policies, practices and processes applied by the ECB when assessing the suitability.

Credit risk and accounting for expected credit losses (ECL)

(16/05/2017) EBA – Final Guidelines on credit institutions’ credit risk management practices and accounting for expected credit losses
The EBA has published Final Guidelines on credit institution’s credit risk management practices and accounting for ECL with the aim of harmonizing the criteria established by the BCBS and ensuring consistent interpretations and practices according to IFRS 9.

Information and communication technology (ICT) risk

(12/05/2017) EBA – Final Guidelines on ICT Risk Assessment under the Supervisory Review and Evaluation Process (SREP)
The EBA has published Final Guidelines on the assessment of the information and communication technology (ICT) risk under the Supervisory Review and Evaluation Process (SREP). This Guidelines, addressed to competent authorities, are intended to promote common procedures and methodologies for the assessment of the ICT risk under the SREP.


(08/05/2017) BoE – Indicative MREL data for UK banks
The BoE has published MREL data for UK banks establishing the minimum indicative MREL requirements for both UK systemically important banks (UK G-SIBs and D-SIBs) and other firms with a resolution plan that involves the use of bail-in or transfer powers. These indicative MRELs are not binding or a definitive determination of future consolidated MRELs, which will require consultation with competent authorities and relevant EU resolution authorities.

European market infrastructure regulation (EMIR)

(08/05/2017) EC – Proposal for a Regulation amending EMIR / Annex to the Proposal / Impact assessment
The EC has published a Proposal for a Regulation amending the European Market Infrastructure Regulation (EMIR) that sets out a number of targeted modifications of EMIR in order to simplify the rules and make them more proportionate. In particular, this proposal introduces amendments regarding inter alia the clearing obligation, central counterparties’ transparency, the reporting obligation, quality of data, and supervision and data availability in trade repositories.


Other publications of interest

Finalisation of the review of the Basel III framework

(25/05/2017) BCBS – Regulatory equivalence and the global regulatory system
The BCBS’s Secretary General, William Coen, has issued a keynote highlighting the importance of global standards for financial regulation and providing an overview of the BCBS finalisation of the Basel III post-crisis reforms and agenda. In particular, this keynote covers the steps done to reform the standardised approach and the IRB approach for credit risk, the operational risk framework, the leverage ratio surcharged for G-SIBs, and the design of the output floor (which is emphasized in this keynote as it is under discussion).

EU transparency exercise 2017

(25/05/2017) EBA – Details of its 2017 EU-wide transparency exercise
The EBA has announced that it will publish data for its fourth annual EU-wide transparency exercise in December 2017 together with the Risk Assessment Report (RAR). This exercise will be launched in September 2017 and it will be based exclusively on supervisory reporting data so banks will not be required to report any additional data.

Connected clients

(25/05/2017) EBA – CP on the scope of the draft GL on Connected Clients under Article 4 (1) (39) of the CRR
The EBA has published a Consultation Paper on the scope of its draft Guidelines (GL) on connected clients with the aim at proposing to extend the scope of these GL to the remaining aspects of the CRR, the EBA technical standards, and other EBA GL where the concept of ‘group of connected client’ is relevant.

Valuation for resolution purposes

(23/05/2017) EBA – Final RTS on valuation for the purposes of resolution and on valuation to determine difference in treatment following resolution under Directive 2014/59/EU on recovery and resolution of credit institutions and investment firms
The EBA has published its Final RTS on valuation in resolution aiming to provide the independent valuer with common criteria for the valuation as well as the valuation principles to be followed before and after a resolution occurs. These RTS will inform the decisions made by resolution authorities, thus promoting a consistent approach to such valuations across the EU.

Misconduct risk

(23/05/2017) FSB – Stocktake of efforts to strengthen governance frameworks to mitigate misconduct risks
The FSB has published a Stocktake of efforts to strengthen the governance frameworks to mitigate misconduct risks on the use of these frameworks by national authorities and firms.

Own funds

(23/05/2017) EBA – Opinion on own funds in the context of the CRR review / Report on the monitoring of CET1 instruments issued by EU institutions
The EBA has published two documents on own funds in the EU. The first one is an Opinion published in the context of the European Commission proposal to amend the CRR and the CRD IV calling, in particular, for a possible strengthening of the EBA's role in assessing issuances of CET1 instruments. The second one is the fifth updated list of capital instruments that competent authorities have classified across the EU have classified as CET1.


(22/05/2017) ESMA – Opinion on OTC derivatives traded on a trading venue
The ESMA has issued an opinion on the implementation of MiFID II and MiFIR, clarifying the concept of “traded on a trading venue” (TOTV), which is relevant for pre-trade and post-trade transparency requirements on market operators and investment firms; and for transaction reporting obligations.


(23/05/2017) EIOPA – Consultation Paper 16/003 on the methodology to derive the ultimate forward rate and its implementation / Updated calculation of the UFR for 2018
The EIOPA has published a consultation paper on the methodology to derive ‘Ultimate Forward Rate’ (UFR) and its implementation, as well as its updated calculation for 2018. This document includes, among others, the final methodology to derive the UFR and the results of an information request to undertakings on the UFR.

Cloud services

(18/05/2017) EBA – CP on Recommendations on outsourcing to cloud service providers under Article 16 of Regulation (EU) No 1093/2010
The EBA has launched a consultation setting out its guidance for the use of cloud service providers by financial institutions. This consultation paper includes several recommendations that intend to clarify the supervisory expectations if institutions adopt cloud computing, so as to allow them to leverage the benefits of using these services, while ensuring that any related risks are adequately identified and managed.

Occupational pensions stress test

(18/05/2017) EIOPA – Occupational Pensions Stress Test 2017
The EIOPA has launched an EU-wide stress test for the Institutions for Occupational Retirement Provision (IORPs). This exercise takes into account the impact of the macro-financial developments since the first stress test in 2015, and is designed to assess the resilience of the sector to an adverse market scenario using common methodologies.

IFRS 17 (insurance contracts)

(18/05/2017) IASB – IFRS 17 Insurance Contracts
The IASB has issued IFRS 17 Insurance Contracts aiming to help investors to understand insurers’ risk exposure, profitability and financial position. This standard replaces IFRS 4 in order to provide a better comparison between companies by requiring all insurance contracts to be accounted for in a consistent manner and updated regularly.

Accountability in UK

(12/05/2017) PRA – Policy on strengthening accountability in banking and insurance regimes
The PRA has published a set of documents, including two Policy Statements (PS), one Supervisory Statement (SS) and one Statement of Policy (SoP), on the strengthening accountability in banking and insurance regimes.

Shadow Banking

(10/05/2017) FSB – Global Shadow Banking Monitoring Report 2016
The FSB has published the Global Shadow Banking Monitoring Report 2016, which presents the results of the annual monitoring exercise that assesses global trends and risks in the shadow banking system (e.g. maturity/liquidity mismatches, leverage, etc.).

Recovery and resolution

(08/05/2017) EBA – CP RTS on simplified obligations
The EBA has launched a consultative document on its draft RTS specifying the eligibility criteria to determine whether institutions should be subject to simplified obligations when drafting their recovery and resolution plans.

Payment accounts

(05/05/2017) EBA – Final RTS and ITS on fee terminology and disclosure documents under the Payment Accounts Directive
The EBA has published Final RTS and ITS setting out the standardised terminology for services linked to a payment account, the standardised format and common symbol of both the fee information document (FID) and the statement of fees (SoF).


(05/05/2017) EBA – CP GL on the security measures for operational and security risks of payment services under PSD2
The EBA has launched a consultative document on Guidelines on security measures for operational and security risks aiming to strengthen the integrated payments market in the EU, mitigating the increased security risks arising from electronic payments, and promoting equal conditions for competition.

Benchmarking of internal models

(04/05/2017) EBA – Amended ITS on benchmarking of internal approaches
The EBA has published an amended version of its ITS on benchmarking of internal approaches which aims at ensuring a better quality of the submitted data and, ultimately will assist the EBA and competent authorities in their 2018 assessment of internal approaches for credit and market risk.

Market abuse

(03/05/2017) CNMV – Circular 1/2017 sobre los contratos de liquidez
The CNMV has approved Circular 1/2017 on liquidity agreements that sets out the operating rules for issuers and establishes a number of mechanisms that are designed to promote confidence in the market, thereby ensuring it operates in an orderly fashion. The new regulation introduces specific rules, such as conditions for the insertion or modification of orders during auction periods with regard to price and volume, conditions for carrying out transactions in the block segment, etc.


(03/05/2017) FCA – PS17/10: Remuneration in CRD IV firms. Final guidance and changes to Handbook
The Financial Conduct Authority (FCA) has published a Policy Statement (PS) on final Handbook text and guidance on remuneration to help firms understand the rules that apply to their remuneration policies and practices. In particular, this guidance is aligned with the EBA guidelines on sound remuneration policies.


(02/05/2017) FCA – PS17/6: Disclosure rules following application of PRIIPs Regulation. Feedback to CP16/18 and final rules
The FCA has published a PS that sets out how the disclosure requirements will change to reflect the introduction of the Packaged Retail and Insurance-based Investment Products (PRIIPs) key information document (KID).

Corporate governance

(28/04/2017) FSB – Thematic Review on Corporate Governance
The FSB has published a peer review on corporate governance, which offers 12 recommendations focusing, among others aspects, on ensuring the basis for an effective corporate governance framework, disclosure and transparency, role of stakeholders in corporate governance, etc.

ECB supervisory fees

(28/04/2017) ECB – Decision of the ECB on the total amount of annual supervisory fees for 2017
The ECB has published a decision on the supervisory fees for 2017 where it has estimated that the total costs associated with its prudential supervision of the banking system for 2017 will be €425 million, an increase of about 10% compared with 2016. Predominantly, the increase relates to work associated with the TRIM.


(28/04/2017) PRA – PS9/17: Implementation of MiFID II. Part 2
The Prudential Regulation Authority (PRA) has published a PS that provides final policy as part of the PRA’s transposition of the MiFID II. This policy maintains the PRA’s approach but introducing new PRA rules to implement MiFID II provisions regarding organisational requirements and the management body.

Solvency II in UK

(28/04/2017) PRA – PS11/17: Maintenance of the ‘transitional measure on technical provisions’ under Solvency II / ‘Solvency II: Supervisory disclosures, the PRA’s supervisory approach and insurance regulations applicable in the United Kingdom’​
The PRA has published a PS on the transitional measure on technical provisions (TMTP) under Solvency II which sets out final policy intended to clarify the PRA’s expectations for maintaining the calculation of the TMTP both at outset and over the transitional period.

© GMS Management Solutions, S.L., 2017. All rights reserved. The information contained on this publication is of a general nature and does not constitute a professional opinion or an advisory service. The data used in this publication come from public sources. GMS Management Solutions, SL assumes no liability for the veracity or accuracy of such data.