(This e-mail provides the headers of a selection of the articles published this week. If you would like to upgrade to our Gold service and access all articles - with live links to the underlying news - please click on the button)
Articles from 7-13 October 2022
Policy impacting Finance
POLITICO: Germany keeps door open to using EU loans amid energy crisis : Berlin says it does not want to openly debate a new SURE mechanism just now, but also doesn’t rule it out.
EURACTIV: Brussels eyes multi-year fiscal plans that include investment, reform : The ongoing reform of EU fiscal rules could give governments more leeway in plans that combine debt cuts with investment and reforms, in exchange for greater accountability, the EU’s Economic Commissioner Paolo Gentiloni said
Project Syndicate: Where Has All the Liquidity Gone? : After two years of quantitative easing, central banks have begun to shrink their balance sheets, and liquidity seems to have vanished in the space of just a few months – revealing acute financial-system vulnerabilities. Monetary-policy normalization will be exceedingly difficult, fraught with risk.
Banking Union
Banks exposed to downside risks as residential real estate markets get overheated, EBA Report finds : House prices across the EU have increased substantially during 2021. This has raised concerns about overheating and the potential for significant price declines in residential real estate markets.
EBA clarifies the status of several disclosure guidelines, and ensures continuous transparency of credit quality of exposure : The EBA is repealing three outdated disclosure guidelines and amending the scope of application of the Guidelines on disclosure of non-performing and forborne exposures; the EBA is ensuring a sufficient level of transparency on the credit quality of the exposures held by all institutions.
EBA updates on the monitoring of total loss-absorbing capacity and minimum requirement for own funds and eligible liabilities instruments : It has identified the need for a few new notable provisions to be recommended and for some others to be avoided.
SRB: Margin for redemptions of eligible liabilities : To redeem eligible liabilities institutions need to demonstrate that they would meet their Minimum Requirement for Own Funds and Eligible Liabilities (MREL) and the Combined Buffer Requirement plus a margin after the transaction has been performed.
ECB: Real estate and financial stability : The analytical toolkit for the assessment of residential real estate vulnerabilities; The analytical toolkit for the assessment of residential real estate vulnerabilities;Are risk weight policies similar to capital buffers? ... Vi
Capital Markets Union
EBF Response to ESMA Consultation on Product Governance : The EBF submitted its response to the ESMA Consultation on the review of the Guidelines on MiFID II product governance requirements: timing; Avoid additional complexity; more flexibility; clustering approach
BEUC: ESMA guidelines on MiFID II product governance requirements : BEUC largely agrees with ESMA’s proposals for changes to the product governance guidelines. While we are suggesting improvements in a few sections, the changes overall contribute to a more consumer friendly interpretation of the MiFID II framework.
BDB: Comments - Review of the Guidelines on MIFID II product governance requirements : ESMA has now consulted the market on its reviewed guidelines
AFME: New EU sovereign bond trading data underlines need for careful post-trade deferrals calibration : AFME and FINBOURNE Technology published a report which analyses EU sovereign and public bond trading data consolidated from numerous sources for the period of March to December 2021. This report follows an earlier April 2022 report which focused on the corporate bond trading landscape.
IOSCO issues regulatory measures to address increasing risks and challenges from digitalisation of retail marketing and distribution : The measures outlined in the Final Report on Retail Distribution and Digitalisation aim to assist IOSCO members in adapting their regulatory and enforcement approaches, consistent with their legal and regulatory frameworks, to meet the growing challenges posed by rapidly evolving digitalisation and online activities.
Capital Markets Union: The Commission publishes its report on the review of the Securitisation Regulation : The report concludes that the market seems to work soundly, even though dynamic market growth has not yet materialised.
ESMA announces strategic priorities for the next five years : ESMA will focus on strengthening supervision, enhancing the protection of retail investors, fostering effective markets and financial stability, enabling sustainable finance, as well as facilitating technological innovation and effective use of data.
ICMA Quarterly Report for the Fourth Quarter of 2022 : The Quarterly Report includes international capital market practice and regulatory updates on the primary markets, secondary markets, repo and collateral markets, sustainable finance, and FinTech and digitalisation.
EIOPA evaluates progress on supervising the propriety of (re)insurers’ administrative, management and supervisory body members and qualifyin : EIOPA has found that the supervision of AMSB members’ and qualifying shareholders’ propriety assessment has improved during the last two years even though the development of supervisory practices is still in progress in a number of countries.
InsuranceEurope: Insurers urge caution on potential supervisory overreach on pricing : EIOPA’s decision to publish specific measures targeting pricing and commercial decision making would be unprecedented and must be treated sensitively to avoid calling on national insurance supervisors to overstep their specified mandates.
Environmental, Social, Governance (ESG)
FSB publishes recommendations for supervisory and regulatory approaches to climate-related risks and calls for continued progress on disclosu : The reports have been delivered to G20 Finance Ministers and Central Bank Governors for their 12-13 October 2022 meeting.
TCFD Report Finds Steady Increase in Climate-Related Financial Disclosures Since 2017 : The percent of companies disclosing TCFD-aligned information steadily increased each year since 2017 as did the amount of information disclosed
EFAMA: The market for ESG ratings should be transparent and competitive | Market Insights : EFAMA has released a new issue of its Market Insights series titled “ESG ratings of Article 8 and 9 funds: assessing the current market and policy recommendations for the future”.
BEUC: MiFID II Sustainability Requirements : On the path to a greener and more sustainable economy, consumers face an additional challenge: the risk of greenwashing when their investments are directed to activities that are not aligned with their interests and values.
IPE: Austria files lawsuit against taxonomy with European Court of Justice : Austria, alongside other environmental organisations, has criticised the decision of the European Commission to list nuclear and gas as sustainable activities.
Platform Recommendations on Data and Usability of the EU Taxonomy : The attached summary of recommendations has been prioritised high, medium, low based on the urgency with which they are addressed to support upcoming and implemented Sustainable Finance reporting obligations.
Protecting Customers
Giving consumers control of their data: BEUC position paper on the Data Act proposal : Putting consumers in control, by empowering them to decide who to share their data with, can deliver greater and better product functionalities and services to consumers, thereby favouring innovation that benefits consumers.
UK Finance' Miles: Reputation risk and integrity: Conduct regulators now look to punish 'ethical misfires' : Briefing with the Financial Conduct Authority (FCA)’s leaders in the Conduct and Culture space, I’m bound to reflect on what practical steps we all need to take; how best to translate the regulator’s latest initiatives on Consumer Duty, Diversity, and Vulnerability into new reporting practices
Fin Tech Regulation
ESBG keeps a close eye on prudential treatment of crypto assets : ESBG responded to the second public consultation of the Basel Committee on Banking Supervision (BCBS) on the prudential treatment of banks' crypto asset exposures, which is built on the proposals in the first consultation issued in June 2021.
SUERF's Kosse and Mattei: The potential of central bank digital currencies for cross-border payments : This Policy Brief presents the key findings of a survey of central banks about their engagement in central bank digital currency (CBDC) and it discusses these findings in the context of cross-border payments. Nine out of 10 central banks are exploring CBDCs and more than half consider it likely or possible they will issue a CBDC in the foreseeable future.
Brexit and the City
Treasury Committee to scrutinise major changes to financial services legislation : In a session with the new Financial Secretary to the Treasury and City Minister, Andrew Griffith, the Committee will explore the content of the legislation, which proposes wide-ranging changes to the regulation of the financial services industry in the UK.
UKandEU: Where next for financial services under Kwasi Kwarteng? : Sarah Hall looks at how the new Chancellor has approached the financial services industry so far and sets out what the implications of a more deregulatory agenda in this area might be.
Brexit
UKandEU: The Northern Ireland Protocol Bill: context and consequences : This report explains some of the context to the Bill, the conditions in which it has emerged and its potential ramifications for Northern Ireland, the UK, the EU, and UK-EU relations.