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15 March 2018

This week in "Brussels"

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  Articles from 08 March 2018 - 15 March 2018

  Banking Union
Reducing risk in the Banking Union: Commission presents measures to accelerate the reduction of non-performing loans in the banking sector
The European Commission is proposing an ambitious and comprehensive package of measures to tackle non-performing loans in Europe, capitalising on the significant progress already made in reducing risks in the banking sector.  View Article
EBA advises European Commission on the use of prudential backstops to prevent the building up of new NPLs
The EBA notes that the backstop complements the existing prudential set of measures and the new accounting provisions under IFRS9 and the advice aims at providing some qualitative considerations as well as a conservative impact analysis of the proposed measures.   View Article
Remarks by Vice-President Dombrovskis at the ECOFIN press conference
The European Commission Vice-President spoke about the progress of the banking union project and about the efforts to reduce the amount of Non-Performing Loans.  View Article
EBA: Getting familiar with the EBA templates on NPLs
The European Banking Authority released a video to help all interested stakeholders get familiar with the key features of the two sets of EBA templates on non-performing loans (NPLs) published on 14 December 2017.   View Article
The EBA launches consultation on how to manage non-performing exposures
The EBA launched a consultation on its Guidelines for credit institutions on how to effectively manage non-performing exposures (NPEs) and forborne exposures (FBEs). The Guidelines target high NPE banks with the aim of achieving a sustainable reduction of NPEs to strengthen the resilience of their balance sheets and support lending into the real economy.  View Article
Basel Committee publishes follow-up reports on Basel III implementation assessments and an updated handbook for jurisdictional assessments
The Basel Committee on Banking Supervision has published overviews of follow-up actions taken or planned by member jurisdictions as of end-2017 to address deviations from the Basel standards that were identified as part of the Committee's Regulatory Consistency Assessment Programme (RCAP). This covers assessments that were completed and published as of end-2016.  View Article
EBA issues Opinion on measures to address macroprudential risk
The EBA published an Opinion following the notification by the French High Council for Financial Stability (HCSF) of its intention to tighten the large-exposure limits applicable to large and highly indebted non-financial corporations (NFCs) resident in France or groups of connected NFCs assessed to be highly indebted and based in France.   View Article
BIS: Central bank digital currencies could impact payments, monetary policy and financial stability
Central banks must carefully weigh the implications for financial stability and monetary policy of issuing digital currencies available to the general public, according to a report from the CPMI and the Markets Committee, although the underlying technologies might hold more promise for wholesale payments, clearing and settlements.  View Article
Financial Times: EU body strikes back at cryptocurrency regulation
The head of the EU’s banking regulator has struck back at calls to regulate cryptocurrencies in a speech that warned against overly regulating fintech firms.  View Article
BBC: IMF says digital currency tech can be used against crypto criminals
Christine Lagarde has called for a crackdown on cryptocurrencies, saying the technology can be used to "fight fire with fire". The head of the International Monetary Fund says governments around the world could harness the technology to stop illegal activity.  View Article
EPC: Digital payments and cybersecurity: trends, risks and solutions
In the new era of digital payments, where technologies are constantly changing and evolving, there are numerous cybersecurity challenges to take into account. Christoph Fischer, CEO and owner of BFK edv-consulting GmbH, provides a brief overview of current cybersecurity trends, threats and solutions.  View Article
The EPC launches the SEPA Credit Transfer and SEPA Direct Debit rulebook consultation
The change requests relate to the SEPA Credit Transfer (SCT), the SEPA Instant Credit Transfer (SCT Inst), the SEPA Direct Debit Core (SDD Core) and/or the SDD Business-to-Business (SDD B2B) schemes.   View Article
FSB publishes supplementary guidance to the FSB principles and standards on sound compensation practices
The guidance provides firms and supervisors with a framework to consider how compensation practices and tools, such as in-year bonus adjustments, malus or clawback, can be used to reduce misconduct risk and address misconduct incidents.  View Article
FCA publishes discussion paper on transforming culture in financial services
The Financial Conduct Authority (FCA) has published a discussion paper on transforming culture in financial services which presents views from academics and industry thought leaders. The paper is intended to provide a basis for stimulating further debate on transforming culture in the sector.  View Article
Bank of England: Fees regime for financial market infrastructure supervision 2018/19
This consultation paper sets out further details on the proposal to introduce a new funding structure for the supervision of financial market infrastructure, including the fee levels for 2018/2019.   View Article
BIS: March 2018 BIS Quarterly Review: Volatility returns to centre stage after stock market wobble
Volatility returned to markets in February, puncturing a long period of unusual calm and highlighting the tricky task central banks face in normalising accommodative monetary policies.   View Article
EBA launches call for expression of interest for new members of its stakeholders group
The European Banking Authority launched a call for expression of interest for membership to its Banking Stakeholder Group (BSG), as the mandate for the majority of its members will expire on 14 October 2018.   View Article
  Capital Markets Union
Capital Markets Union: breaking down barriers to cross-border investments and accelerating delivery
The European Commission is taking a major step towards the development of a Capital Markets Union by promoting alternative sources of financing and removing barriers to cross-border investments.  View Article
Opening remarks by Vice-President Dombrovskis on the Capital Markets Union
Mr Dombrovskis spoke about the Capital Markets Union project and the need to accelerate its implementation, so European consumers, investors, and companies can benefit from deeper and more integrated capital markets.  View Article
Financial Times: Brexit threatens to undo Mifid II dark pool rules
European stock trading has entered a new era with the introduction of caps on the volume of business that can be traded in private venues known as dark pools. Yet this regime may be short-lived and possibly a waste of time and resources.  View Article
Financial Times: Fund managers count cost of Mifid research shake-up
Asset managers are setting aside tens of millions of dollars after agreeing to swallow the cost of paying for investment research following the introduction of wide-ranging European market rules this year.  View Article
ESMA publishes the responses to its Consultation on Draft Guidelines on APC Margin Measures for CCPs
ESMA published the responses received to its Consultation on Draft Guidelines on Anti-Procyclicality Margin Measures for CCPs.  View Article
ISDA: Get engaged on benchmark reform
ISDA Chief Executive Officer Scott O'Malia offers informal comments on important OTC derivatives issues in derivatiViews, reflecting ISDA's long-held commitment to making the market safer and more efficient.   View Article
  Clients Union
FCA publishes discussion paper on transforming culture in financial services
The paper is a set of essays that discuss what a good culture might look like, the role of regulation and regulators, how firms might go beyond incentives, and how to change behaviour for the better.  View Article
Financial Times: Bankers need higher professional standards to regain trust
The industry’s international reputation was shredded not only by a string of bank failures but by the emergence soon after of systematic collusion and market-rigging, and the institutional mis-selling of products for huge profit. The living standards of millions of ordinary people were hammered hard — and many are still paying the price.  View Article
OECD: The cyber insurance market: Responding to a risk with few boundaries
On the occasion of the OECD Conference on Unleashing the Potential of the Cyber Insurance Market, the OECD’s Bill Below and Leigh Wolfrom look at some of the challenges to insuring cyber risk.  View Article
Insurance distribution: Council delays application of new rules
The Council has delayed the application of new rules on insurance distribution.  View Article
ECA: EU Auditors publish background paper on insurance market watchdog
The European Court of Auditors has published a Background Paper on the EIOPA and its contribution to supervision and financial stability in the EU insurance sector.   View Article
  Asset Management
EFAMA warns a legislative proposal at this stage can act as an additional barrier rather than facilitating cross border fund distribution
The Commission is proposing changes that include both the AIFM and UCITS Directives, which are the main pillars of the legislative framework for investment funds.  View Article
Financial Times: Insurers pose risk to pension reform, body warns
Sweeping reforms of UK pensions are in “great danger” of being derailed because insurance companies are withdrawing cover for financial advisers providing advice on retirement arrangements, according to a trade body.  View Article
Financial Times: European fund sales reforms criticised by trade bodies
New plans by the European Commission to stimulate fund sales across Europe have been met with a frosty reception from trade bodies that represent asset managers.   View Article
Invest Europe: New private equity rules risk future funding for European companies, warns Invest Europe
Changes to regulation, proposed by the European Commission, could limit future funding prospects for one in four companies seeking private equity investment, says Invest Europe.  View Article
  Corporate Governance/Accounting
EFRAG: Feedback statement on goodwill impairment paper
EFRAG issued a feedback statement on the DP Goodwill impairment test: can it be improved? which summarises the response received from constituents. The feedback will be used by EFRAG in developing its response to any future IASB proposals arising from its Goodwill and Impairment research project.  View Article
IIA releases new model risk management guidance
Models are relied upon to make important decisions in the financial services industry, making it imperative for internal auditors to understand key elements like business significance, model risk management components, and regulatory concerns and expectations.  View Article
Financial Times: Accounting watchdogs find ‘serious problems’ at 40% of audits
Global accounting watchdogs identified serious problems at 40% of the audits they inspected last year, raising fresh concerns about the quality of work being carried out by the world’s largest accounting firms.   View Article
FRC compendium of Ethical and Auditing Standards 2018
The FRC has published its compendium of Ethical and Auditing Standards 2018, including those in issue since 1 January 2018: Ethical Standard; International Standards on Auditing (UK); and International Standard on Quality Control (UK) 1.  View Article
ACCA: Risks of cryptocurrencies like Bitcoin must be better understood by accountancy profession
ACCA has issued a new warning to professional accountants over the importance of maintaining an up-to-date understanding of developments in the fast-moving space of cryptocurrencies like Bitcoin.  View Article
ACCA: Introduction of key audit matters leads to improved governance, audit quality and corporate reporting
Recent changes to auditor reporting standards have not only improved the quality of information available to investors, but also had positive effects on broader elements of financial reporting, including governance and corporate reporting; according to a new report from ACCA.  View Article
ACCA: Business leaders must embrace the broader benefits of integrated thinking
Companies reporting under the International Integrated Reporting Framework have, for the most part, made striking progress in quality over the last year but there’s scope for businesses to reap more benefits by embedding integrated thinking into internal decision-making processes, according to ACCA.  View Article
  Financial Services Policy
European Commission's Action Plan on Sustainable Finance
The Commission has published its “Action Plan: Financing Sustainable Growth“ to propose an EU strategy on sustainable finance and set out a roadmap for further work and upcoming actions covering all relevant actors in the financial system.  View Article
FinTech: Commission takes action for a more competitive and innovative financial market
The European Commission unveiled an Action Plan on how to harness the opportunities presented by technology-enabled innovation in financial services (FinTech).  View Article
ECB's Benoît Cœuré: A Euro Cyber Resilience Board for pan-European Financial Infrastructures
The Member of the Executive Board of the ECB discussed the future course of the high-level cyber resilience forum for pan-European financial market infrastructures, critical service providers and competent authorities.  View Article
Insurance Europe: VAT rules must be modernised to reflect market realities
Insurance Europe has published a position paper that calls for a thorough review of the Value Added Tax (VAT) Directive to modernise VAT rules in the EU, particularly in the field of financial services.  View Article
  Grahams Articles, Comments & Speeches
Brexit ‘hard facts’ might become insurmountable facts in Ireland - 139th Brussels for Breakfast – CPD Notes
A furious storm is brewing up over a hard border between Northern Ireland and the rest of the island which threatens not only the terms of the Good Friday Agreement, but also to put an end to Brexiteers’ dreams of an 'unshackled' UK after Brexit.  View Article
  Friends Services
Brexit ‘hard facts’ might become insurmountable facts in Ireland - 139th Brussels for Breakfast – CPD Notes
A furious storm is brewing up over a hard border between Northern Ireland and the rest of the island which threatens not only the terms of the Good Friday Agreement, but also to put an end to Brexiteers’ dreams of an 'unshackled' UK after Brexit.  View Article
US tariffs: “Avoid trade wars and tackle global overcapacity in steel instead” urge MEPs
The EU should not engage in a trade war, but must be ready to defend its citizens, MEPs said in a debate on planned US trade restrictions.  View Article
Main results - Economic and Financial Affairs Council
Ministers agreed on a proposal aimed at boosting transparency in order to address aggressive cross-border tax planning. The Council also updated the EU's list of non-cooperative jurisdictions in taxation matters.  View Article
Remarks by M. Centeno following the Eurogroup meeting of 12 March 2018
The Eurogroup commended Greece for completing the third review of the ESM programme. EU Ministers of finance prepared the euro summit of March, with work on ESM reform, Banking Union and other longer-term issues, including fiscal issues.  View Article
Main results - Competitiveness Council
The Council adopted conclusions on industrial policy. It also held discussions on the future of the single market and the digitalisation of the European economy.  View Article
Employment up by 0.3% in the euro area and by 0.2% in the EU28
The number of persons employed increased by 0.3% in the euro area (EA19) and by 0.2% in the EU28 in the fourth quarter of 2017 compared with the previous quarter, according to national accounts estimates published by Eurostat.  View Article

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