Articles from 18 December 2020- 7 January 2021
General Financial Policy
General Financial Policy
EU-UK Trade and Cooperation Agreement: protecting European interests, ensuring fair competition, and continued cooperation in areas of mutual interest: After intensive negotiations, the European Commission has reached today an agreement with the United Kingdom on the terms of its future cooperation with the European Union.
ECON: COVID-19: deal to give go-ahead to the new Recovery and Resilience Facility : RRF is the biggest building block of the Next Generation EU, €672.5 billion in grants and loans to support EU countries for three years, Funds supporting key policy areas such as green transition, digital transformation, crisis preparedness as well as children and youth
PIIE's Veron: Memo to the European Commission on the European Union’s contribution to international financial regulation and oversight : The Commissioner for Financial Services Policy should define and promote a vision for a sustainable global financial regulatory and supervisory order, based on the lessons from the previous major international financial crisis in 2007-09 and its aftermath.
Banking Union
SSM's Enria: wide-ranging Interview with Börsen-Zeitung : Dividends, NPLs, bad bank, mergers, fit-and-proper managers, IT, cyber, AML, Basel III
ESRB's Mazzaferro at SUERF: Consequences for banks’ business from COVID-19 and policy responses : Concerted responses by fiscal, monetary and prudential authorities to the COVID crisis have successfully avoided a systemic financial crisis in the spring. But the impact of the crisis on banks’ balances sheets will only become fully visible, when the lagged effects on unemployment and firm insolvencies may strike, as governmental loan guarantees and moratoria expire.
SRB: A European Bad Bank – a necessary tool for financial stability? : Andrea Enria’s recent comments in the Financial Times fanned the embers of the idea of a pan-European Asset Management Company, more commonly referred to as a European bad bank. Mr Enria promoted the idea as a possible tool for strengthening financial stability across the Banking Union’s banking sector.
Capital Markets Union
Insurance Europe: EIOPA’s Solvency II review opinion fails to offer improvements to help EU economy, consumers and green transformation : Following the publication of the European Insurance and Occupational Pensions Authority’s (EIOPA) opinion to the European Commission on the review of Solvency II, deputy director general of Insurance Europe, Olav Jones, said:
EIOPA outlines key financial stability risks and vulnerabilities for insurance and pension sector and recommends that any dividend distributions: The European Insurance and Occupational Pensions Authority (EIOPA) published today its December Financial Stability Report that sheds light on the financial stability risks in the European insurance and pension sector.
EIOPA consults on ORSA in the context of COVID-19 : The European Insurance and Occupational Pensions Authority (EIOPA) published today a consultation on the Supervisory Statement on Own Risk Solvency Assessment (ORSA) in the context of COVID-19.
ESMA Consultation Paper MiFID II/MiFIR review report on Algorithmic Trading : Many provisions of MiFID II relate either directly or indirectly to algorithmic trading. This consultation paper therefore adopts a holistic approach to algorithmic trading and reviews all related provisionstogether with the aim of having the current framework operating more efficiently.
Environmental, Social, Governance (ESG)
GRI: Step towards stronger financial reporting to complement sustainability reporting : GRI responds to launch of prototype climate-related financial disclosure standard
IFAC Welcomes New Report on Climate-Related Financial Disclosure : IFAC applauds the publication today of Reporting on Enterprise Value, Illustrated with a Prototype Climate-Related Financial Disclosure Standard, a new report from leading sustainability and integrated reporting organizations CDP, CDSB, GRI, IIRC, and SASB.
Insurance Europe: Insurers warn EIOPA against prescriptiveness in ORSA climate risk requirements : Insurance Europe has today published its response to a consultation conducted by the European Insurance and Occupational Pensions Authority (EIOPA) on its draft opinion on the use of climate change scenarios in an insurer’s own risk & solvency assessment (ORSA).
EFAMA: Asset Managers support call for regulation of ESG data, research and ratings : EFAMA, the voice of the European investment management industry, joins the French and Dutch financial market authorities’ call for a European regulation of ESG data, research and ratings.
SMSG Response to ESMA’s Consultation on the Draft Advice to the European Commission under Article 8 of the Taxonomy Regulation : The SMSG largely supports ESMA’s draft advice to the European Commission. Nevertheless, the SMSG makes a number of general comments and advises ESMA to change or refine its approach in respect of specific aspects of the draft.
ICMA responds to the draft Delegated Act supplementing the EU Taxonomy Regulation : ICMA believes that while Substantial Contribution and DNSH are recognised as fundamental concepts of the Taxonomy, the Delegated Acts or associated commentary could go further to acknowledge that implementation will take time, even for advanced actors, and that some criteria remain undefined.
EFAMA: EU Taxonomy at risk of hampering green housing investments : As the voice of the European asset management industry, EFAMA strongly welcomes the development of the EU Taxonomy and its proposed technical screening criteria in the Delegated Acts.
Protecting Customers
Insurance Europe: European Data Protection Board should take risk-based approach to international data transfers : A broad coalition of industry federations – including Insurance Europe – has published a joint statement raising serious concerns about a set of draft recommendations published by the European Data Protection Board (EDPB) in the wake of the European Court of Justice Schrems II decision.
EDPB consultation on supplementary measures: EBF response : The European Banking Federation (EBF) welcomes the opportunity to respond to the European Data Protection Board’s (EDPB) consultation on its Recommendations on measures that supplement transfer tools to ensure compliance with the EU level of protection of personal data.
Fin Tech Regulation
Vox: The European Commission Digital Markets Act: A translation : The European Commission has finally issued the proposed Digital Markets Act, its bid to complement antitrust intervention in digital markets with ex-ante regulation in the form of a set of obligations that platforms identified as “gatekeepers” should abide by.
Brexit
Federal Trust: Was Godot worth the wait? The EU-UK Trade and Cooperation Agreement explained : Since the white smoke emerged from the European Commission chimney on the afternoon of Christmas Eve, journalists, commentators and representatives of just about every conceivable interest have been crawling over it to work out what it means, who won or lost and how it will affect people on both sides of the English channel.
CEPS: John Bruton - The Brexit trade deal is no frictionless uncoupling : The Trade and Cooperation Agreement between the EU and the UK is an exercise in damage limitation. The UK’s decision to leave the EU, the Customs Union and the Single Market, means it will face numerous obstacles.
Project Syndicate's Gabriel: Europe After Brexit : Remaining wary of geopolitics, Germany has been carrying its weight on internal EU political matters, pointing to a potential division of labor between itself and France in the future. The question is can Europe find ways to preserve both its own autonomy and its close partnership with America.
BusinessEurope:EU-UK: a deal is most welcome : Today the European Union and the United Kingdom concluded a long-awaited agreement that will govern their future relationship. As we are approaching the end of the transition period, both sides should do the necessary to allow the deal to be applied as of 1 January 2021.
FT Shrimsley:The Brexit deal is just the end of the beginning : Shorn of the economic advantages of EU membership, the UK is going to need a more agile and effective leadership
Federal Trust: Brexit: The “Deal” is less than it seems : Throughout the month of December commentators and politicians speculated tirelessly on the likelihood of a negotiated trade arrangement between the UK and EU before the end of the year. Many expected that the personal convictions of Boris Johnson and the intransigence of the Conservative Party would prevent the conclusion of any such agreement. On 24rd December, those who took this view were apparentlyproved wrong.
FCA: Regulatory change for firms as Brexit transition period ends : As of 11pm on 31 December 2020, the transition period ended and EU law no longer applies in the UK. For many financial services businesses, this means changes to existing systems and services.
Bloomberg: The Key Issues Weighing on the City of London After Brexit Deal : U.K. firms have days left to prepare for looser EU links; Local offices, equivalence and market disruption on the agenda
SRB and Bank of England bank resolution cooperation arrangement comes into force : The Single Resolution Board and the Bank of England continue to work closely together to ensure we have appropriate arrangements in place for effective cooperation on the management of the failure of cross border banks, should the need arise.
ESMA withdraws the registrations of six UK-based credit rating agencies and four trade repositories : The European Securities and Markets Authority (ESMA), the supervisor of European Union (EU) credit rating agencies (CRAs) and trade repositories (TRs), has withdrawn the registrations of the following United Kingdom (UK) based CRAs:
FCA: MoUs with European authorities in the areas of securities, insurance and pensions, and banking : The MoUs came into effect at the end of the transition period.
Bloomberg: Britain Budges on Derivatives Rules in Last-Minute Brexit Relief : Britain’s market watchdog eased restrictions on cross-border derivatives trading in a move to calm fears of market turbulence just hours before the Brexit transition period ends.
FT: London unlikely to regain lost EU share trading, warn City figures : UK has given up about €6bn of daily volume since Brexit transition ended. The EU share trading that flooded out of the City of London after the end of the Brexit transition is unlikely to return, banks and asset managers have warned.