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02 March 2017

This week in "Brussels"

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  Articles from 23 February 2017 - 02 March 2017

BCBS: Basel III Monitoring Report
This report presents the results of the Basel Committee's latest Basel III monitoring exercise. The Committee established a rigorous reporting process to regularly review the implications of the Basel III standards for banks, and it has published the results of previous exercises since 2012.  View Article
BCBS: Second set of FAQs issued on Basel III's Net Stable Funding Ratio (NSFR)v
The Basel Committee on Banking Supervision has issued a second set of frequently asked questions (FAQs) and answers on Basel III's Net Stable Funding Ratio (NSFR).   View Article
EBA publishes results of the CRDIV-CRR/Basel III monitoring exercise as of end June 2016
The report summarises the results, but does not reflect any BCBS standards agreed since the beginning of 2016, such as the revisions to the market risk framework, or any other BCBS proposals, which have not yet been finalised, including the revisions to credit and operational risk frameworks.   View Article
Andreas Dombret: The future of global economic cooperation - Brexit, Basel III and beyond
The Deutsche Bundesbank examined how bankers can stabilise and improve global cooperation, and discussed two current sets of negotiations: Brexit and Basel III.  View Article
EBA updates on the 2018 EU-wide stress test timeline
The Board of Supervisors of the European Banking Authority (EBA) agreed in its meeting held on 14 February on the tentative timeline of the 2018 EU-wide stress test.  View Article
Financial Time: Our stable financial system benefits everyone
Jeopardising the repairs carried out by regulators would be misguided, writes the PRA's Sam Woods.  View Article
Financial Times: Challenger banks boosted by Bank of England rule changes
The UK’s challenger banks have received a boost from the Bank of England after it said it would revise the way bespoke capital rules are set, which has been a thorny issue for smaller lenders.  View Article
GFMA/IIF response to FSB consultation: Guidance on continuity of access to Financial Market Infrastructures for a firm in resolution
GFMA and IIF recognise that maintaining continuity of access to critical FMI services is an essential part of resolution planning and welcome the FSB providing guidance to build upon the Key Attributes and the work undertaken by firms in this area.  View Article
IIF-GFMA Response to FSB Consultation on Guiding Principles on the Internal Total Loss-Absorbing Capacity of G-SIBs (“Internal TLAC”)
The Associations are concerned that the draft Guidance in its present form does not fully achieve the goal of clarifying the Term Sheet and may even tend to undermine coherent, collaborative group approaches to resolution.  View Article
ECB: Macro stress testing euro area banks' fees and commissions
This paper estimates a macro-financial model for fee and commission income over total assets. The results indicate that the fee and commission income ratio is varying in particular with changes in its own lag, the short term interest rate, stock market returns and real GDP growth.  View Article
EUbusiness: Improving the EU financial instruments: AECM and UEAPME present their proposals for the EU mid-term review
On the occasion of the upcoming mid-term review of COSME and InnovFin, the European Association of Craft and SMEs and AECM publish a joint position paper detailing their requests for improving the guarantee instrument.  View Article
EBA paves the way for open and secure electronic payments for consumers under the PSD2
The European Banking Authority published its final draft Regulatory Technical Standards (RTS) on strong customer authentication and common and secure communication. These RTS pave the way for an open and secure market in retail payments in the European Union.  View Article
Benoît Coeuré: Blockchain for banks is a "long way off"
Blockchain fintech has a “long way to go” to satisfy financial regulators, according to the European Central Bank's Coeuré.  View Article
ECB: Tenth survey on correspondent banking in euro
Comparing the individual data and names of the credit institutions participating in the most recent surveys, it seems that the top players on the correspondent banking market have remained the same. The survey show a decrease in loro account turnover since 2014 and in the number of customers.  View Article
CITY A.M.: Has the P2P halo slipped?
For the past few years it has seemed like P2P lenders could do no wrong. Seen as the feisty challengers to the allegedly ineffective and self-serving banking giants, these champions of the honest and hardworking SME were going to revolutionise the way businesses were funded.  View Article
Financial Times: Top bank executives required to vouch for cyber attack defences
Top executives at some of the world’s biggest banks and insurers will have to vouch for their companies’ resilience to cyber attacks, under tough rules laid down by New York’s state regulator.  View Article
Commission report: Accelerating the capital markets union - Addressing national barriers to capital flows
The Commission adopted a report looking at how to tackle national barriers with a view to fostering the flow of cross-border investments in the EU.  View Article
Euractiv: Commission confirms work on securitisation of EU sovereign bonds
European Commission Vice-President Valdis Dombrovskis said that the goal of setting up European Safe Assets is to reduce banks’ exposure to sovereign debt.  View Article
PCS launches a new label for risk transfer/synthetic securitisations
PCS launched its new label to be awarded to risk transfer instruments that meet all the criteria devised by the PCS Association to identify the key elements for a simple, transparent and standardised instrument.  View Article
The Economist: Europe’s securitisation market remains stunted
The European regulators have sought not just to rehabilitate, but indeed actively to promote such “structured” finance.  View Article
ESAs publish statement on variation margin exchange
ESAs have published a statement in response to industry requests relating to operational challenges in meeting the deadline of 1 March 2017 for exchanging variation margin.  View Article
FCA Statement on EMIR 1 March 2017 variation margin deadline
The new regime for variation margin may require a number of significant changes for many firms in terms of documentation and other arrangements, according to the FCA.  View Article
IOSCO statement on variation margin implementation
The Board believes that relevant IOSCO members should consider taking appropriate measures available to them to ensure fair and orderly markets during the introduction and application of such variation margin requirements.  View Article
EPRS: Prospectuses for investors
The aims of the regulation are to contribute to further financial market integration and to improve investor protection in the European Union. The proposal broadens the scope of the legislation and introduces changes to how the prospectus is drawn up.  View Article
Harmonisation of the Unique Transaction Identifier (UTI), guidance issued by CPMI-IOSCO
A new report provides technical guidance to authorities to enable them to set rules on assigning uniform global Unique Transaction Identifiers (UTIs) to over-the-counter (OTC) derivatives transactions.  View Article
BaFin: Reporting obligation under MiFIR - LEI will be compulsory from 2018 onwards
From 3 January 2018 onwards a legal entity identifier will be necessary for reportable transactions pursuant to Article 26 of the Markets in Financial Instruments Regulation.  View Article
ESMA publishes 2017 Supervisory Convergence Work Programme
ESMA has published its 2017 Supervisory Convergence Work Programme (SCWP), which details the activities and tasks it will carry out to promote sound, efficient and consistent supervision across the European Union.  View Article
ECB: A stochastic forward-looking model to assess the profitability and solvency of European insurers
Authors develop an analytical framework for conducting forward-looking assessments of profitability and solvency of the main euro area insurance sectors. The model highlights the potential threats to insurers solvency and profitability stemming from a sustained period of low interest rates.  View Article
EIOPA updates the technical documentation of the methodology to derive the risk-free interest rate term structure
The European Insurance and Occupational Pensions Authority (EIOPA) published an update of the technical documentation of the methodology to derive the risk-free interest rate term structures.  View Article
EIOPA’s new risk dashboard for the first time based on the Solvency II Data
The European Insurance and Occupational Pensions Authority (EIOPA) published for the first time after the implementation of the new Solvency II regime its new risk dashboard.  View Article
  Asset Management
ECB: New statistics on euro area insurance corporations and pensions funds
The European Central Bank (ECB) has released new euro area statistics on insurance corporations as of the third quarter of 2016 and pension funds as of the first quarter of 2016. The sectors are now shown separately and in more detail, reflecting enhanced data collection frameworks.   View Article
John Nugée: The Bank of England, financial stability and the next crisis
There is a growing concern among regulators and market participants alike that the next crisis may appear in a completely different part of the financial eco‑system, that of the asset management community, argues OMFIF's Nugée.  View Article
Investment & Pensions Europe: Pension fund pooling 'not a panacea', fund managers warn
Pooling pension fund assets into fewer, larger funds will not necessarily improve investment performance, according to the UK’s asset management trade body.  View Article
Investment & Pensions Europe: LAPFF hits out at UK's Financial Reporting Council
The Local Authority Pension Fund Forum (LAPFF) has called on the UK government to give “serious consideration” to winding up the UK Financial Reporting Council (FRC).  View Article
Financial Times: Asset managers turn against investment consultants
Asset managers have called for stricter oversight of the UK’s hugely influential investment consulting industry after Britain’s financial watchdog warned of conflicts of interest and a lack of transparency in the sector.   View Article
  Corporate Governance/Accounting
Agreement to extend EU programme on financial reporting and auditing
The Maltese Presidency and European Parliament representatives reached a provisional agreement to extend EFRAG's funding for the period 2017-2020.   View Article
EFRAG´s study from an economic consultancy used as input to its Endorsement Advice on IFRS 16 Leases
EFRAG commissioned a study from an independent economic consultancy as an input to its Endorsement Advice on IFRS 16 Leases. EFRAG's Draft Endorsement Advice, which is open for comment until 13 March 2017, include various references to this study.   View Article
ECIIA: Non-financial reporting guidance should adopt three lines of defence model
The three lines of defence model of corporate governance is the best mechanism to help companies with non-financial reporting, the ECIIA has told DG FISMA.  View Article
ACCA: Government need to see bigger picture on corporate governance
According to ACCA, government needs to show stronger support for voluntary measures which improve corporate governance rather than impose a legislative mandate.  View Article
IFAC: Accountants offer crucial help in reducing global corruption
A new study, The Accountancy Profession—Playing a Positive Role in Tackling Corruption, from the IFAC shows professional accountants are playing a major, positive role in reducing corruption, along with other key actors in the global economy that support strong governance structures.  View Article
  Financial Services Policy
FSB assesses implementation progress and effects of reforms
The FSB reviewed progress on both the implementation of post-crisis reforms and the evaluation of their effects and effectiveness.  View Article
European Commission: EU equivalence decisions in financial services policy: an assessment
The Commission published an assessment of EU equivalence decisions in the area of financial regulation.  View Article
Financial Times: Trump threatens to tear up the trade rule book
Bypassing the World Trade Organisation would be a serious error, in the FT's view.  View Article

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© Graham Bishop

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