A Management Solutions compila novidades regulatórias publicadas durante as últimas semanas por diferentes órgãos reguladores e supervisores (com foco no setor financeiro).
(23/07/2018) EBA – Final Guidelines on the revised common procedures and methodologies for the SREP and supervisory stress testing / Final Guidelines on common procedures and methodologies for SREP and supervisory stress testing - Consolidated version / Final Guidelines on the management of interest rate risk arising from non-trading activities / Final Guidelines on institutions stress testing
The EBA has published three Final Guidelines (GLs) regarding: i) common procedures and methodology for SREP and supervisory stress testing, ii) the management of interest rate risk arising from non-trading activities (IRRBB), and iii) institution’s stress testing. These GLs aim to update the existing regulation on these aspects, i.e. the EBA GL on SREP published in 2014, the EBA GL on the management of the IRRBB published in 2015, and the Committee of European Banking Supervisors GL on stress testing (CEBS GL 32) published in 2010, respectively.
(12/07/2018) Gobierno de España – Anteproyecto de Ley de medidas para la transformación digital del sistema financiero
The Spanish Government has published an Anteproyecto de Ley (APL) de medidas para la transformación digital del sistema financiero, with the aim of maintaining the effectiveness of the financial policy through an organised digital transformation, reinforcing legal certainty and ensuring protection of consumers of financial services. In particular, this APL mainly addresses the concept of regulatory sandbox, the functioning of the regulatory sandbox, and the adoption of other measures that facilitate digital transformation.
Regulatory and reporting requirements
(09/07/2018) Fed/FDIC/OCC – Statement regarding the impact of the Economic Growth, Regulatory Relief, and Consumer Protection Act (EGRRCPA) / Statement describing how, consistent with the EGRRCPA, the Fed will no longer subject primarily smaller, less complex banking organizations to certain Fed regulations
The Fed, the FDIC and the OCC has published a Statement regarding the impact of the EGRRCPA, which provides information on rules and associated reporting requirements that the agencies jointly administer and that the Economic Growth, Regulatory Relief, and Consumer Protection Act (EGRRCPA) immediately affected. Further, the Fed has published a Statement describing how, consistent with the EGRRCPA, the Fed will no longer subject primarily smaller, less complex banking organizations to certain Fed regulations.
(06/07/2018) BCBS – G-SIBs revised assessment methodology and the higher loss absorbency requirement
The BCBS has now published the G-SIBs revised assessment methodology and the HLA requirement, which maintains the core elements and fundamental structure of the G-SIBs’ framework set out in 2013, although introduces certain enhancements regarding: i) the definition of cross-jurisdictional indicators, ii) the introduction of a trading volume indicator and modification of the substitutability category’s weights, iii) the extension of the scope of consolidation, iv) the review of the disclosure requirements, v) the provision of further guidance regarding bucket migration and the associated HLA surcharge, and vi) the adoption of a transitional schedule.
(04/07/2018) EBA – Thematic Report on the impact of FinTech on incumbent credit institutions' business models / Thematic Report on the prudential risks and opportunities arising for institutions from FinTech
The EBA has published a Thematic Report on the impact of FinTech on incumbent credit institutions' business models which covers, among others, the categorisation of incumbent, drivers of business model’s changes, and the relationships of incumbents with FinTech. Further, the EBA has also published a Thematic Report on the prudential risks and opportunities arising for institutions from FinTech which aims to raise awareness of current and potential FinTech applications.
(04/07/2018) ECB – Draft Regulation on the materiality threshold for credit obligations past due
The ECB has published a Draft Regulation on the materiality threshold for credit obligations past due in order to define the absolute and relative components of materiality threshold. In particular, this threshold will comprise an absolute component, expressed as a specific maximum amount for the sum of all amounts past due owed by an obligor, and a relative component, expressed as a percentage reflecting the amount of the credit obligation past due in relation to the total amount of all on-balance sheet exposures to that obligor.
(02/07/2018) Fed/FDIC – Proposed Guidance on resolution planning for eight large, complex U.S. Banking Organizations
The Fed and the FDIC have now published a Proposed Guidance on resolution planning for eight large, complex U.S. Banking Organizations, that updates the agencies’ expectations for how a firm's resolution strategy should address the following aspects: i) capital, ii) liquidity, iii) governance mechanisms, iv) operational, v) legal entity rationalization and separability and vi) derivatives and trading activities.
(26/07/2018) Fed – Consumer Compliance Supervision Bulletin
The Fed has published the Consumer Compliance Supervision Bulletin which provides bankers and others interested in consumer protection with high-level summaries of pertinent supervisory issues. In particular, this Bulletin focuses on the illegal discrimination practice known as "redlining," as well as discriminatory loan pricing and underwriting.
European Security Notes
(24/07/2018) EBA – Report on the European Secured Notes (ESNS)
The EBA has published a Report presenting the outcome of its assessment to the European Commission's call for advice (CfA) on the European Secured Notes (ESNs). In particular, this Report covers the following: i) business case for ESNs, ii) impact of ESNs on asset encumbrance, iii) ESNs asset performance and pool eligibility criteria, iv) ESNs applicable structure and features, v) the regulatory treatment of ESNs, and vi) EBA recommendations.
(24/07/2018) ESMA - Follow-up Report to the Peer Review on MiFID Suitability Requirements
The European Securities and Market Authority (ESMA) has published a follow-up Report regarding oversight by national competent authorities (NCAs) of the Markets in Financial Instruments Directive (MiFID II) suitability requirements. In particular, this Report provides an update on the actions ten NCAs have undertaken further to the 2016 peer review report on compliance with the MiFID II suitability requirements. In addition, it identifies enhancements in supervising the requirements and greater deployment of enforcement action by some NCAs.
EIOPA’s risk dashboard
(24/07/2018) EIOPA – Risk Dashboard (July 2018)
The European Insurance and Occupational Pensions Authority (EIOPA) has published its updated Risk Dashboard based on the first quarter 2018 data. In particular, this document which quarterly assess the risks of the European Union insurance industry, covers the following aspects: macro risks; credit, market, liquidity and funding risks; profitability and solvency; interlinkages and imbalances; insurance (underwriting) risks; and market perceptions.
Financial market infrastructures (FMI)
(23/07/2018) IOSCO – Implementation monitoring of PFMI: fifth update to level 1 assessment report
The Committee on Payments and Market Infrastructures (CPMI) and the International Organization of Securities Commissions (IOSCO) have published the Fifth update to Level 1 assessment report of implementation monitoring of the Principles for financial market infrastructures (PFMI). In particular, this Report shows that further progress has been made among some participating jurisdictions that had not completed the adoption of their implementation measures at the time of the 2017 update. Indeed, 21 out of the 28 jurisdictions have completed the adoption of measures for all FMI types, compared to 20 jurisdictions in the previous update.
(18/07/2018) FSB – Consultation on the effects of reforms on infrastructure finance
The FSB has published a Consultation Report on the evaluation of the effects of financial regulatory reforms on infrastructure finance, focusing on infrastructure finance that is provided in the form of corporate and project debt financing (loans and bonds). In particular, this document concludes that the effect of the G20 financial reforms on infrastructure finance is of a second order relative to other factors, such as the macro-financial environment, government policy and institutional factors.
(18/07/2018) EBA – Guidelines on fraud reporting under the Payment Services Directive 2 (PSD2)
The EBA has published its Final Guidelines on fraud reporting under the revised Payment Services Directive (PSD2), aiming at contributing to the objective of PSD2 of enhancing the security of retail payments in the EU. In particular, these Guidelines require payment service providers across the 28 EU Member States to collect and report data on payment transactions and fraudulent payment transactions using a consistent methodology, definitions and data breakdowns.
(16/07/2018) FSB – Crypto-assets: Report to the G20 on the work of the FSB and standard-setting bodies
The FSB has published a Report setting out a framework to monitor crypto-asset markets in order to monitor the financial stability implications of the developments in crypto-asset markets. In particular, this Report sets out the metrics that the FSB will use to monitor developments in crypto-asset markets as part of the FSB’s ongoing assessment of vulnerabilities in the financial system.
(12/07/2018) FSB – Interest rate benchmark reform. Overnight risk-free rates and term rates
The Financial Stability Board (FSB) has published a statement which refers to reforms to interbank offered rates (IBORs) and the development of overnight risk-free, or nearly risk-free, rates (RFRs) and term rates. In particular, this Statement is intended to provide market participants and other stakeholders with the FSB’s views ahead of the consultation by the International Swaps and Derivatives Association (ISDA) which contemplates fall backs for certain derivative contracts based on overnight RFRs.
(12/07/2018) BoE - Systemic Risk Buffers and Pillar 2A in stress test hurdle rates
The Bank of England (BoE) has announced its intention to change the way hurdle rates are calculated in the annual stress test. In particular, this statement further specific details on two of these changes that: i) hurdle rates will incorporate buffers to capture domestic systemic importance as well as global systemic importance; and ii) the calculation of minimum capital requirements incorporated in the hurdle rates will more accurately reflect how they would evolve in a real stress.
(11/07/2018) ECB – Announcement of further steps in supervisory approach to stock of NPLs
The ECB has announced further steps in its supervisory approach for addressing the stock of NPLs in the euro area. In particular, this new approach creates a consistent framework to address the stock of NPLs as part of the supervisory dialogue through bank-specific supervisory expectations, and it is aimed at achieving adequate provisioning of legacy NPLs thereby contributing to the resilience of the euro area banking system as a whole.
(10/07/2018) EBA – Report on the peer review of the RTS on passport notifications
The EBA has published a Final Peer Review Report on the RTS on the information to be notified when exercising the right of establishment and the freedom to provide services for credit institutions, which summarises the main findings addressed. In particular, this Report shows that competent authorities have developed consistent and robust procedures to comply with the RTS requirements although the level of sophistication of these processes varies across Member States.
(04/07/2018) IOSCO – Consultation Report on Commodity Storage and Delivery Infrastructures: Good or Sound practices
The International Organization of Securities Commissions (IOSCO) has published a Consultation Report on proposed good or sound practices to assist relevant storage infrastructures and their oversight bodies to identify and address issues that could affect commodity derivatives’ pricing and in turn affect market integrity and efficiency. In particular, this document provides examples of good or sound Practices of the following types: i) preventative practices that seek to establish good governance and dispute resolution procedures in order to avoid issues; ii) monitoring practices that seek to identify and address issues as they arise to mitigate deleterious effects; and iii) punitive practices which address, through resolution, certain behaviours after the fact.
(04/07/2018) ECB – SSM LSI SREP Methodology
The ECB has published the 2018 edition for the SSM LSI (less significant institutions) SREP Methodology which is based on four key elements: i) business model assessment; ii) governance and risk management assessment; iii) assessment of risks to capital; and iv) assessment of risks to liquidity and funding. Further, this document covers the background of the SSM LSI SREP and its principles among with the NCAs and ECB competences and some guidelines and supervisory best practices of the above mentioned methodology.
(04/07/2018) PRA – SS5/16 Corporate governance: Board responsibilities
The PRA has updated its Supervisory Statement (SS) 5/16 on corporate governance and the board responsibilities with the aim at identifying those aspects of governance to which the PRA attaches particular importance and to which the PRA may devote particular attention in the course of its supervision (e.g. setting the institution’s strategy, risk appetite, or risk management).
(03/07/2018) ECB – Report on recovery plans
The ECB has published a Report on recovery plans which main purpose is to share the lessons ECB Banking Supervision has learned and the best practices it has identified, after three successive cycles of analysing recovery plans, in order to help significant institutions (SIs) further shape their plans and make them even more operational. However, this Report does not aim to impose additional requirements on banks.
(29/06/2018) EBA – Updated ITS package for 2019 benchmarking exercise
The EBA has published an update to the ITS on benchmarking of internal approaches for the 2019 benchmarking exercise. In particular, this update includes a new set of portfolios which are significantly simpler in their composition and consist of plain vanilla instruments. Moreover, minor changes have been introduced for the credit risk portfolios.
© GMS Management Solutions, S.L., 2018. Todos os direitos reservados. A informação contida nesta publicação tem caráter geral e não constitui opinião profissional e nem serviço de assessoramento de nenhuma espécie. Os dados utilizados nesta publicação proveem de fontes de informação públicas. A GMS Management Solutions, S.L. não assume responsabilidade alguma sobre a veracidade ou correção de tais dados.