09 March 2020

ESMA’s supervision focuses on outstanding credit ratings, data quality and third country CCPs

ESMA is also preparing for its new supervisory responsibilities under the Securities Financing Transactions Regulation (SFTR), the Securitisation Regulation (SECR), the Benchmarks Regulation and MiFIR.

The European Securities and Markets Authority (ESMA) has published its 2020 Supervision Work Programme, detailing the areas of focus for its supervision of Credit Rating Agencies (CRAs), Trade Repositories (TRs) and the monitoring of third-country Central Clearing Counterparties (TC-CCPs) and Central Securities Depositories (TC-CSDs).

ESMA’s supervisory focus will include:

·         CRAs – outstanding ratings, the rating process, cybersecurity, usability of ratings, internal control environment;

·         TRs – data quality; IT systems reliability; business continuity planning and information security;

·         SFTR/SECR – assessment of first SFTR and SECR applications and the implementation of the new supervisory frameworks;

·         TC-CCPs & TC-CSDs – assessment of application of the clearing obligation; Brexit preparations and possible direct supervision of Tier 2 TC-CCPs under EMIR 2.2

In addition, ESMA will continue to engage with  supervised entities about their  preparation for the end of the Brexit implementation period and ensure minimal disruption.

Steven Maijoor, Chair, said:

“ESMA is now in its tenth year as a pan-European supervisor and we have continued to progress in our supervision of CRAs and TRs and effect improvements in CRAs and TRs conduct as seen in our recent work on fees, Brexit contingency plans, review of CLO credit ratings and TR data quality. 

“I believe that our performance in those ten years was a key factor in the European institutions decision to increase ESMA’s supervisory responsibilities under the ESAs Review. We now look forward to building on our experience with CRAs and TRs to transition to the new role of securitisation repositories and critical EU benchmarks supervisor and continue, through this work, to play our role in ensuring orderly markets, investor protection and financial stability.”  

Full Supervision Work Programme

© ESMA