This week in "Brussels"
27 April 2017
Progress report on adoption of Basel III, BRRD, euro area bank lending survey, a proposal for a Eurozone-level asset management company, trade repositories, MAR, Solvency II, IFRS 9, ESAs, Eurobill Proposal and more.
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Articles from 20 April 2017 - 27 April 2017 |
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Banking |
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BCBS: Twelfth progress report on adoption of Basel III standards published by the Basel Committee
The Basel Committee on Banking Supervision has issued the Twelfth progress report on adoption of the Basel regulatory framework. This report sets out the adoption status of Basel III standards for each BCBS member jurisdiction as of end-March 2017. View Article |
City A. M.: Global banking watchdog will pause for thought before introducing more regulations
Global banking regulators will pause for two years and take stock of their post-crisis reforms, allowing the sector a chance to catch its breath before any new initiatives are pursued. View Article |
Boston Herald: Trump eyes changes to Obama's tax and Wall Street rules
Hoping to spur economic growth, President Donald Trump embarked on new steps to dismantle some of the tax and financial regulations established by former President Barack Obama. View Article |
Valdis Dombrovskis, Vice-President of the European Commission Keynote speech "Transatlantic cooperation – key for jobs and economic growth"
Dombrovskis pointed to three areas where international cooperation is particularly crucial: derivatives markets, bank capital charges and crisis management. View Article |
City A. M.: Bank of England's Mark Carney warns regulators must end a reliance on mega-fines for banks
Regulators must end an "excessive reliance" on mega-fines for banks, Bank of England (BoE) governor Mark Carney said. View Article |
Vox EU: The Basel process of capital regulation: A story of good intentions and unintended consequences
The Basel Accord initiated what has become a three decade-long process of regulatory convergence of the international banking system. This column says - by trying to regulate minimal capital standards, the Basel process itself contributed to an ever-increasing shortfall in aggregate bank capital. View Article |
ISDA Publishes Second Bail-in Article 55 BRRD Protocol
The International Swaps and Derivatives Association has announced the launch of a second protocol to help market participants to meet the requirements of Article 55 under the European Union Bank Recovery and Resolution Directive. View Article |
ECB: Results of the April 2017 euro area bank lending survey
Credit standards for loans to enterprises eased slightly in net terms in the first quarter of 2017, according to this BLS. The net easing (-2%) of credit standards – i.e. banks’ internal guidelines or loan approval criteria – follows a net tightening of 5% in the previous quarter. View Article |
The Times: Banks pop up with way to stay in City after Brexit
Wall Street banks are considering setting up “pop-up” branches in European countries to deal with trading after Brexit while keeping the bulk of their work for continental clients in London. View Article |
Vox EU: An asset management company for the Eurozone: Time to revive an old idea
Nine years after the onset of the Global Crisis, the problem of non-performing assets is still acute. This column takes stock of the different proposals to deal with the issue. It argues that a Eurozone-level asset management company can resolve bank fragility and spur economic recovery. View Article |
Bruegel: Tackling Europe’s crisis legacy: a comprehensive strategy for bad loans and debt restructuring
Eight years after the start of Europe’s financial crisis, the legacy of non-performing loans and excessive private debt remains a key obstacle to the recovery of bank credit and investment. View Article |
Bloomberg: One third happy to ditch cash as Europe looks to digital future
Cash may still be king for most Europeans, but more than one in three would be happy to abandon it altogether. View Article |
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Securities |
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ESMA advises Commission on fees for trade repositories
The European Securities and Markets Authority published its final technical advice to the European Commission regarding supervisory fees for Trade Repositories under the Securities Financing Transactions Regulation. View Article |
ESMA publishes an opinion on MAR accepted market practices on liquidity contracts
The agreed points are expected to be used as a reference in the assessment of the MAR AMPs on liquidity contracts that national competent authorities may submit to ESMA after a domestic consultation and on which ESMA will have to issue an opinion. View Article |
Bank of England: New UK Money Markets Code launched
A new voluntary UK Money Markets Code setting out the standards and best practice expected from participants in the deposit, repo and securities lending markets has been published. View Article |
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Insurance |
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Financial Times: UK insurers fear election’s impact on payout reforms
Fears are growing in the insurance industry that the UK election could delay or even derail keenly awaited reforms to personal injury compensation rules. View Article |
EIOPA proposes amendments to the adopted Solvency II technical standards on reporting and disclosure
The EIOPA has identified some required amendments to the ITS on the templates for the submission of information to the supervisory authorities (ITS on Reporting) and in the ITS with regard to the procedures, formats and templates of the solvency and financial condition report (ITS on Disclosure). View Article |
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Asset Management |
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Investment & Pensions Europe: ECB's planned pension fund reporting requirements criticised
The planned European Central Bank regulation on statutory reporting requirements for pension schemes could lead to extensive reporting obligations – and considerable additional costs – for pension institutions, according to speakers at a recent roundtable event in Frankfurt. View Article |
Vox EU: Shadow borrowing through the UK’s defined benefit pension system
This column analyses how pension scheme funding deficits arise and argues that whilst deficits do not exist by design, firms’ decision to fund or underfund a defined benefit scheme might usefully be examined as one of many competing sources of long-term finance. View Article |
Hedgeweek: FIS and AITE Group release new study of boutique asset management landscape
Research by FIS shows boutique asset managers can gain an edge despite the challenges of maintaining active strategies. In an industry increasingly dominated by the success of passive products, boutique asset managers hold a generally positive outlook for the future of active investment management. View Article |
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Corporate Governance/Accounting |
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EFRAG: Draft comment letter on the IASB’s ED/2017/2 Improvements to IFRS 8 Operating Segments
EFRAG has published its draft comment letter in response to the IASB's Exposure Draft ED/2017/2 Improvements to IFRS 8 Operating Segments – Proposed amendments to IFRS 8 and IAS 34 and seeks constituents' views on the proposals. View Article |
IASB proposes minor amendments to IFRS 9 to aid implementation
The IASB has proposed minor amendments to the financial instruments Standard, IFRS 9, to enable companies to measure at amortised cost certain prepayable financial assets with so-called negative compensation. View Article |
FRC: IAASB consults on revised proposals for auditing accounting estimates
The IAASB is consulting on a proposal to revise its standard for the audit of accounting estimates and related disclosures. The FRC is seeking views on the IAASB’s revised proposals from UK stakeholders. View Article |
IASB: IFRS Foundation publishes 2016 Annual Report
The IFRS Foundation has published its Annual Report for the year ended 31 December 2016. View Article |
IFAC: IPSASB publishes 2015-2016 Biennial Review – Sustaining the Momentum
The 2015-2016 Biennial Review: Sustaining the Momentum summarizes the IPSASB’s achievements, challenges, and key developments in 2015 and 2016. View Article |
IFAC: IESBA embarks on strategic review
The IESBA released an online survey seeking comments, views, and insights from all stakeholders to help shape its future strategic direction. View Article |
IFAC: IAASB proposes modernization of financial estimate audits in support of audit quality
Significant changes in how auditors evaluate accounting estimates and related disclosures have been proposed by the IAASB. The changes will require auditors to sharpen their focus on risks of material misstatements arising from accounting estimates. View Article |
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Financial Services Policy |
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ESAs highlight main risks for the EU financial system
ESAs published their spring 2017 Report on risks and vulnerabilities in the European Union’s financial system. View Article |
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Grahams Articles, Comments & Speeches |
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A Eurobill Proposal for the Commission Reflection Paper on Completing the Economic and Monetary Union
The European Commission has undertaken to produce a Reflection Paper on “ideas, proposals and options” by end-May on the deepening of the EMU. Accordingly, Graham Bishop has refined further his plan for a Temporary Eurobill Fund (TEF), and commends it to the EC for consideration in its Reflections. View Article |
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Political |
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LSE: Emmanuel Macron may win the presidential election, but turbulent waters lie ahead
Having topped the vote in the first round of the election, Macron will now have to deal with a number of new challenges, including greater scrutiny over his policy proposals, and the task of organising his ‘En Marche!’ movement ahead of legislative elections in June. View Article |
Paul Goldschmidt: Europe after the French vote: a unique opportunity not to be squandered!
The European question will be at the heart of the second round debate: It will allow the reinforcement of the arguments supporting the EU’s accomplishments as well as the potential gains to be expected from its further integration and deepened solidarity. View Article |
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Financial |
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BIS: Arbitrage costs and the persistent non-zero CDS-bond basis: Evidence from intraday euro area sovereign debt markets
Authors find evidence that in the market for euro area sovereign credit risk, arbitrageurs engage in basis trades between credit default swap (CDS) and bond markets only when the CDS-bond basis exceeds a certain threshold. View Article |
ESMA discusses market-based finance in latest Banque de France Financial Stability Review
ESMA discusses market-based finance in Europe in an article published in the Banque de France's Financial Stability Review. View Article |
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Economic |
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Statement by ECB's Mario Draghi at the thirty-fifth meeting of the International Monetary and Financial Committee
Draghi said that complete EMU is the foundation for a stable, flourishing and resilient euro area economy that will be the best contribution to global economic growth and financial stability. View Article |
Speech by Commissioner Moscovici at the Peterson Institute for International Economics, Washington DC: "Europe's pivotal year"
Moscovici said that the challenges that lie ahead for Europe now are mostly of a political nature, and that, while the European economy is strengthening overall, the picture remains highly diverse from country to country, particularly within the eurozone. View Article |
ACCA: Government should have postponed IR35
The changes to IR35 work towards a fairer tax system. However, ACCA believes the rules have not had the appropriate time allocated for consideration. View Article |
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Budgetary |
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Council adopts new rules to better protect EU finances
The Council adopted a directive on the protection of the financial interests of the EU (PIF Directive). This will improve the prosecution and sanctioning of crimes against EU finances, and facilitate the recovery of misused EU funds. View Article |
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Graham's tweets |
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© Graham Bishop
Banking