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20 February 2020

This week in "Brussels"



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Articles from 13 February 2020 - 20 February 2020

The City - City AM

General Policy

FCA highlights its areas of concern in financial services markets : The FCA has published its annual Sector Views, an assessment of the risks and potential harm to consumers across financial services markets. The Sector Views look at the impact of macroeconomic developments and common drivers of change emerging across financial markets.  View Article

Banking Union

EBA shows banks’ progress in planning for failure but encourages them to issue eligible debt instruments : The EBA published its first quantitative Report on minimum requirements for own funds and eligible liabilities (MREL) under a new methodology. The report shows that authorities have made strong progress in agreeing resolution strategies and setting related MREL requirements but it also notes that banks need to issue MREL eligible debt to close their shortfall. View Article
EBA acknowledges adoption of amended supervisory reporting standards by the European Commission : The European Banking Authority acknowledged the adoption by the European Commission of the Implementing Act amending Regulation with regard to COREP and FINREP changes.  View Article
EBA consults on guidelines on the appropriate subsets of exposures in the application of the systemic risk buffer : These Guidelines aim at setting a common framework to harmonize the design of the appropriate subsets of sectoral exposures to which a systemic risk buffer may be applied, thus facilitating a common approach throughout the EU. View Article
ECB: Working group on euro risk-free rates issues recommendations to support smooth transfer of EONIA’s liquidity to €STR : The report supplements a previous report from the working group on the impact of the transition from EONIA to the €STR on cash and derivatives products (published in August 2019) and provides clarifications around specific topics that have been discussed since then. View Article
ECB's Lane: The analytical contribution of external statistics: addressing the challenges : Speech by Philip R. Lane, Member of the Executive Board of the ECB, in which he discusses some of the globalisation-related measurement challenges that are affecting the real side of external statistics, before turning to the financial side.  View Article
Bank of England: How would banks cut their distributions in a period of economic stress? : Banks pay out many types of distributions, including dividends and bonuses. If their capital position deteriorates, banks can cut their distributions. These latest stress-test results show that banks would cut their distributions by £41 billion in a stress scenario. View Article

Capital Markets Union

ESMA finds continued high risks as financial markets remain highly volatile : ESMA identified continued high risks and a weaker economic outlook as markets remain highly sensitive to geopolitical events. The risk outlook is stable, however risks are high, particularly in the securities markets and for retail investors. View Article
Financial Times: Former Morgan Stanley president slams Europe’s capital markets : Morgan Stanley’s former second-in-command has warned that Europe’s capital markets are “not fit for purpose” and Brexit will make the situation worse. View Article
AFME: Turning up the heat on CMU – AFME’s Spanish Capital Markets Conference Round-up : The Capital Markets Union project is still “not in the oven” - these were the words of José María Roldán, the President of the Spanish Banking Association (AEB), when opening AFME’s 11th Spanish Capital Markets Conference. View Article
ESMA responds to European Commission consultation on the benchmark regulation review : The ESMA has published its response to the European Commission’s (EC) consultation on the review of the benchmark regulation (BMR). ESMA’s responses focus on the cessation of critical benchmarks, parity between EU and third-country benchmarks and transparency. View Article
European Commission: Public consultation on the review of the MiFID II/MiFIR regulatory framework : The Commission’s consultation and separate ESMA consultations on the functioning of certain aspects of the MiFID II are complementary and should by no means be considered mutually exclusive. The Commission and /MiFIR framework ESMA consult stakeholders with respect to their specific area of competence and responsibility and with the objective to gather important guidance for any future course of action on respective sides.  View Article

Environmental, Social, Governance (ESG)

ESMA: Steven Maijoor on sustainable finance at the European Financial Forum in Dublin : Steven Maijoor, Chair of the European Securities and Markets Authority (ESMA), delivered a keynote address on sustainable finance issues at the European Financial Forum in Dublin. View Article
European Commission: EU invests more than €100 million in new LIFE Programme projects to promote a green and climate-neutral Europe : The European Commission announced an investment of €101.2 million for the latest projects under the LIFE programme for the Environment and Climate Action. The funding will support 10 large-scale environment and climate projects in nine Member States, helping Europe's transition to a sustainable economy and climate neutrality. View Article
Investor Strategy: How ESG ratings providers let the side down : An often-expressed criticism of the ESG investing space, mainly by institutional investors, is the lack of robust benchmarks and/or ratings from independent bodies. ESG investing is complex. A new study by Research Affiliates indicates just how much work the industry needs to do to improve accountability. View Article
ACT: Landmark research on 1000 European companies shows troubling poor quality of reporting on sustainability issues : The Alliance for Corporate Transparency analysed the information that companies disclosed on their environmental and societal risks and impacts following the requirements introduced by the EU Non-Financial Reporting Directive. View Article
ECIIA: Keeping the internal audit function aligned : The ECIIA Insurance Committee's thought paper aims to highlight that in order to stay relevant, Internal Audit functions have to transform in alignment with the industry and insurance undertaking in which they operate. View Article

Fin Tech Regulation

Shaping Europe's digital future: Commission presents strategies for data and Artificial Intelligence : Digital is a key enabler to fighting climate change and achieving the green transition. The European data strategy and the policy options to ensure the human-centric development of Artificial Intelligence presented are the first steps towards achieving these goals. View Article
POLITICO: Vestager touts AI-powered vision for Europe’s tech future : Industrial data is key to Europe’s ‘second chance’ at becoming a world leader in tech. Calls for European “technological sovereignty” have raised alarm bells among industrial players and free-trading countries, which fear that political control over competition decisions would lead to picking winners and protectionism. View Article
Bloomberg: German savers transform the Baltics into a Fintech vanguard : In many ways, the Baltic countries are ideally suited for financial-technology firms. Estonia, the birthplace of Skype, has long touted its e-governance prowess. Lithuania has positioned itself as a post-Brexit gateway to the EU for fintech startups. But there’s more to it than that. View Article
POLITICO: Zuckerberg to concede Facebook willing to pay more taxes overseas : Speaking at the Munich Security Conference, the tech boss is expected to throw his weight behind creating a global digital tax regime. View Article
Bank of England: Working paper: Peter Zimmerman: Blockchain structure and cryptocurrency prices : Mr Zimmerman shows that the pricing curve for cryptocurrencies can be locally downward-sloping; he identifies a driver of price volatility speci?c to blockchain technology; he shows that the volatility e?ect is ampli?ed by market illiquidity; and he demonstrates the existence of the digital gold e?ect. View Article

Friends' Standard Services

50th Brussels for Brunch Webinar February 2020 : Video of the 50th Brussels 4 Brunch. View Article

Economic Policies Impacting EU Finance

ACCA and IMA publish report highlighting long-term global economic issues : ACCA and IMA (Institute of Management Accountants) have jointly published the Global Economic Themes report. It examines three of the longer-term structural issues that are affecting the global economy as well as the global economic impact of the US-China trade tensions.  View Article
Main results - Economic and Financial Affairs Council : The Council adopted a revised list of non-cooperative jurisdictions for tax purposes. The Commission presented its review of the EU economic governance. The ministers also discussed the European Semester 2020 and the EU budget for 2021. View Article
European Economic Forecast. Winter 2020 : The Winter 2020 Economic Forecast projects that the European economy is set to continue on a path of steady, moderate growth. View Article
Financial Times: Eurozone weakness is a test for post-crisis policy : Debt costs fall for troubled countries, but currency bloc still has scars, in the FT's view. View Article
BBC: German economy barely grows at end of 2019 : The German economy had another very weak three months at the end of last year, according to official figures. View Article
IMF: Finding solid footing for the global economy : The global economy is far from solid ground. While some uncertainties have receded, new ones have emerged. The truth is that uncertainty is becoming the new normal, acknowledges IMF Managing Director Kristalina Georgieva.  View Article
EurActiv: Pressure mounts on EU leaders to reach MFF deal within days : The tight calendar, the urgent priorities awaiting the EU and the risk of post-Brexit talks affecting the negotiations are adding pressure on EU leaders to reach an agreement within days on the bloc’s long-term budget. Otherwise Europe risks facing a “horror scenario” in January next year. View Article
Main results - Eurogroup : The Eurogroup discussed the economic situation in the eurozone. In inclusive format, ministers adopted a report covering details of a possible Intergovernmental Agreement (IGA) for the budgetary instrument for convergence and competitiveness (BICC). View Article
Charles Michel - Irish Times
EurActiv: Michel offers flexible EU budget to convince sceptics : More flexibility within the Common Agriculture Policy and more money to less developed regions instead of a larger budget is what European Council President Charles Michel will offer sceptical countries to agree on a new EU 7-year spending plan. View Article
Kurier: Austria's potential veto : Following the recent exit of the UK from the EU (who was one of the biggest contributors to the EU budget), other countries are concerned about having to pay for the ‘Brexit gap’, such as Austria, whose Chancellor Sebastian Kurz recently threatened with vetoing the MFF at the next European Council. View Article
EurActiv: Time for a stronger and more sustainable Economic and Monetary Union : Despite continuous efforts by all decision-makers to reform and strengthen the Economic and Monetary Union, the European Economic and Social Committee (EESC) believes that its architecture still remains to be completed, writes Stefano Palmieri. View Article
OECD: Digital economy & tax - analysis shows significant impact of proposed international tax reforms : New economic analysis shows that a proposed solution to the tax challenges arising from the digitalisation of the economy under negotiation at the OECD would have a significant positive impact on global tax revenues. View Article

EU27 Politics

Reuters: Exclusive: Ireland's Fianna Fail to seek to form government without Sinn Fein : Ireland’s center-right Fianna Fail party will seek to form a government that does not include left-wing nationalists Sinn Fein, a senior member of the party said following a meeting of the party’s lawmakers. View Article
Emmanuel Macron - The Guardian
The Guardian: Macron sets out 10-year vision for EU with call for more integration : Europe’s middle classes will only remain reconciled to the European Union if it becomes more integrated, with an effective defence policy, a larger budget and integrated capital markets, and is shorn of vetoes that slow decision-making, the French president, Emmanuel Macron, has said. View Article
Graham Bishop #FBPE retweeted
BBC Politics BBC Politics
UK can't have Canada trade deal with EU, says chief negotiator Michel Barnier
Graham Bishop #FBPE retweeted
<a href=FT Brussels" src="" /> FT Brussels
Brexit: Brussels hits back at UK over level playing field
Graham Bishop #FBPE retweeted
Bloomberg Brexit Bloomberg Brexit
The U.K.’s industrial strategy is not enough to tackle the nation's economic challenges at it leaves the EU, according to the government's own advisers
Graham Bishop #FBPE retweeted
BBC Politics BBC Politics
"We will no longer have the routes for cheap, low-skilled labour that has dominated immigration and our labour market" Home Secretary Priti Patel sets out government's post-Brexit immigration plans, adding businesses should focus on training UK workers
Graham Bishop #FBPE retweeted
BBC Politics BBC Politics
Immigration: No visas for low-skilled workers, government says
Graham Bishop #FBPE retweeted
Federal Trust Federal Trust
"The EU has not forgotten that the City was the epicentre of the Great Financial Crash (GFC) that wrought havoc with the EU’s economy (as well as with the UK’s!)" says @GrahamBishopcom in the second of our new blog series Read more here…
Graham Bishop #FBPE retweeted
Mujt<a href=aba Rahman" src="" /> Mujtaba Rahman
This is purely for domestic consumption. But it won't help negotiations - & will foster mistrust. EU was always clear - in public & private - that obligations on UK would be greater than those on Canada for a *similar level* of access…
Graham Bishop #FBPE retweeted
Zoe Schneeweiss Zoe Schneeweiss
THREAD 1/ Brexit shattered 50 years of trade policy in Britain – Boris Johnson is now trying to glue the pieces back together. @_jsdiamond and I looked at the underlying trade data that may dictate Britain’s priorities in coming months
Graham Bishop #FBPE retweeted
Bloomberg Brexit Bloomberg Brexit
The U.K. will have “full responsibility” for any damage to its economy caused by Brexit, warns the EU's trade commissioner
Graham Bishop #FBPE retweeted
The UK's rejection of demands that it stay aligned with EU rules post Brexit is not a "negotiating position which might move under pressure"

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