This week in "Brussels"
12 May 2016
ECB, bank stress test, Fundamental Review of the Trading Book, Basel III, ESMA, market risks, Solvency II, IOSCO, EIOPA, AIFMD, IFRS, insolvency reform and more.
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Articles from 05 May 2016 - 12 May 2016 |
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Banking |
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Reuters: ECB asks euro zone banks to detail Brexit plans
The European Central Bank has asked large euro zone banks to detail how they are preparing for a British exit from the EU, including how they would deal with the shock to markets and any changes they would have to make to their business models. View Article |
Reuters: ECB to review four banks it may start to supervise
The European Central Bank is carrying out a deep-dive analysis of four banks that it may start to supervise directly, it said. View Article |
Reuters: BlackRock helps ECB in bank stress test
A consultancy owned by the world's biggest investor, BlackRock, will help the European Central Bank in its stress test of top banks, the two organizations said. View Article |
Financial Times: German financial watchdog warns on low rates ‘poison’
Low interest rates are a “seeping poison” for Germany’s banking system, the head of the country’s financial watchdog has warned, in the latest expression of German fears over the European Central Bank’s policies. View Article |
BIS: Ignazio Visco: Asset quality and the new framework for managing banking crises in Europe
Keynote speech by Mr Ignazio Visco, Governor of the Bank of Italy, at the "Workshop on Stability of the Banking System", in which he focused on asset quality and the new framework for managing banking crises in Europe. View Article |
British Banker’s Association: What does the Fundamental Review of the Trading Book mean for banks?
In January the BCBS released its revised rules on trading book capital requirements. These emerged after three consultations aimed at improving the existing market risk capital rules that were introduced in rather a piecemeal way in the wake of the global financial crisis by ‘Basel 2.5’. View Article |
VoxEU: Double bank runs, liquidity risk management, and Basel III
By providing liquidity to credit line borrowers and depositors, banks are potentially exposed to simultaneous runs on their assets and liabilities. This column discusses the risk of double-bank runs, liquidity risk management by banks and the implications for the regulation of the financial sector. View Article |
ECB ends production and issuance of €500 banknote
ECB has decided to permanently stop producing the €500 banknote and to exclude it from the Europa series, taking into account concerns that this banknote could facilitate illicit activities. €500 banknote remains legal tender and will always retain its value. View Article |
British Banker’s Association: How banks can win the data management game
The financial services industry today faces numerous data management challenges to become both customer-centric and meet regulatory requirements. However, many lenders continue to face the challenge of aggregating, managing and creating value from their data. View Article |
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Securities |
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ESMA sees continued high level of market risks in first quarter
According to the Risk Dashboard, the overall risks to securities markets in Q1 2016 remained unchanged at high levels, with market and credit risks being very high. View Article |
Bloomberg: Derivatives traders adopt rules to clear European credit indexes
European Union regulation has come into force that will require traders to start moving the region’s credit derivatives benchmarks through central clearinghouses. View Article |
IOSCO issues report on impact of storage and delivery infrastructure on commodity derivatives market pricing
The report sets out the findings and conclusions of the review of the impact of storage infrastructures on the integrity of the price formation process of physically-delivered commodity derivatives contracts traded on regulated exchanges. View Article |
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Insurance |
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Commercial Risk Europe: Insurers' Q1 profits hurt by market volatility
First quarter results of many commercial insurers and reinsurers in recent weeks suggest a tough year ahead with some companies already warning they may not meet their 2016 targets. View Article |
EIOPA: Monthly update of the symmetric adjustment of the equity capital charge for Solvency II - April 2016
The European Insurance and Occupational Pensions Authority (EIOPA) has published the technical information on the symmetric adjustment of the equity capital charge for Solvency II with reference to the end of April 2016. View Article |
Bank of England: Solvency II - consolidation of Directors’ letters
In this consultation paper, the Prudential Regulation Authority sets out its proposals for streamlining the presentation of the ways in which it expects firms to meet various requirements of Solvency II. View Article |
Bank of England: Solvency II - Changes to internal models used by UK insurance firms
In this consultation paper the PRA proposes a draft supervisory statement setting out the PRA’s expectations on firms and the Society of Lloyd’s in relation to changes to internal models and extensions to the scope of internal models that have been approved under Solvency II. View Article |
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Asset Management |
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InvestEurope: European private equity investment increased, fundraising and exits remain high
According to new data released by Invest Europe, private equity investment into European companies increased by 14% to €47.4 billion in 2015, along with high fundraising and exit activity, in another strong year for European private equity. View Article |
IPE: EIOPA stakeholder groups seek greater visibility, impact
The stakeholder groups of EIOPA want to increase the visibility and impact of their work, according to a joint statement that also rejected the European Commission’s questioning of their and other stakeholder groups’ value. View Article |
Hedgeweek: Assessing the best AIFMD Management Company options
Navigating the increased regulatory requirements of AIFMD has been a costly and resource-intensive exercise for many investment managers over the past few years. View Article |
FSB Regional Consultative Group for Europe
Members of the FSB RCG Europe discussed the progress made by two working groups set up by the RCG Europe. One has reported on Nordic experiences of cooperation on cross-border regulation and crisis resolution. The other will start its work on private pension schemes resilience. View Article |
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Corporate Governance/Accounting |
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IASB: IFRS Foundation publishes the 2016 Pocket Guide to IFRS Standards
The analysis shows that IFRS Standards are required for all or most domestic publicly accountable entities (listed companies and financial institutions) in 119 jurisdictions—83 per cent of those surveyed. Most of the remaining jurisdictions permit their use. View Article |
FEE comments on proposed changes to the Ethics Code on the long association of personnel with an audit client
FEE responded on the IESBA ED Limited Re-exposure of Proposed Changes to the Ethics Code on Addressing the Long Association of Personnel with an Audit Client, and re-emphasised that with the proposed requirements, the Code of Ethics for Professional Accountants would become rules-based and complex. View Article |
EBA comments on the IAASB´s efforts to enhance audit quality
The EBA has published its comment letter on the IAASB Overview of the Invitation to Comment: Enhancing Audit Quality in the Public Interest: A focus on Professional Scepticism, Quality Control and Group Audits (‘Overview of the ITC’). View Article |
IASB/Hans Hoogervorst: Performance reporting and the pitfalls of non-GAAP metrics
Hans Hoogervorst, Chairman of the IASB, has highlighted the consequences of increased use of non-GAAP metrics in company reporting, and the associated challenges with defining performance. View Article |
ECIIA: More communication needed between internal audit and regulators
The ECIIA has suggested in response to recent consultation by EIOPA that regulators should require regular, structured and ongoing dialogue between the competent authorities supervising insurers and the internal auditors working in them. View Article |
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Financial Services Policy |
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EBF, GFMA and ISDA agree common principles to promote effective global policy on cybersecurity, data and technology
The European Banking Federation, the Global Financial Markets Association and the International Swaps and Derivatives Association announced they are seeking to encourage effective global policy measures on cybersecurity, data and technology through a new set of common principles. View Article |
ACCA: ‘Actions speak louder than words’ when it comes to fight corporate malpractice
ACCA´s new report analyses the wide range of ‘speak up arrangements’ used by firms across the world and identifies what makes them effective. The findings show that, though difficult, demonstrating commitment to deal with issues and making the outcomes visible pays off. View Article |
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Grahams Articles, Comments & Speeches |
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Insolvency reform: is it still the really high-hanging fruit?
A proposal is expected later this year and Commissioner Hill may yet succeed because insolvency is now seen as a serious macro-economic problem - especially in states where the consequence of the debt overhang have become an urgent political problem for `growth and jobs’. View Article |
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Graham's tweets |
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© Graham Bishop
Banking