This week in "Brussels"
14 September 2017
Basel III monitoring exercise, MiFID II, EBF, ESMA report on Trends, Risks and Vulnerabilities, Euro clearing following Brexit, Eurobills, State of the Union Address 2017, German elections and more.
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Articles from 07 September 2017 - 14 September 2017 |
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Banking Union |
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EBA: The EBA CRDIV CRR Basel III monitoring exercise shows further improvement of EU banks capital leverage and liquidity ratios
This exercise presents aggregate data on EU banks' capital, leverage, and liquidity ratios assuming full implementation of the CRD IV-CRR/Basel III framework. Overall, the results show a further improvement of European banks' capital positions, with a total average CET1 ratio of 13.4% (12.8% as of 30 June 2016). View Article |
BCBS: Basel III monitoring results published by the Basel Committee
The Basel Committee today published the results of its latest Basel III monitoring exercise based on data as of 31 December 2016. 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 |
Banking in Europe: EBF publishes 2017 Facts & Figures
The publication shows that the contraction in terms of staff numbers and branches in the European banking sector continued in 2016 as customers increasingly embrace electronic payments as well as online and mobile banking. Eurozone deposits and loans grew slightly. View Article |
BIS Working paper: Do negative interest rates make banks less safe?
Authors study the impact of increasingly negative central bank policy rates on banks’ propensity to become undercapitalized in a financial crisis (‘SRisk’). They find that the risk impact of negative rates is moderate, and depends on banks’ business models: Banks with diversified income streams are perceived by the market as less risky. View Article |
BIS: Mark Carney to chair two key BIS central bank groups
The Board of Directors of the BIS has appointed Mark Carney, Governor of the Bank of England, as Chair of the Global Economy Meeting (GEM) and the Economic Consultative Committee (ECC), after consultations with members of the GEM. The appointment takes effect on 1 December 2017. View Article |
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Capital Markets Union |
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Report from the Commission on the need to temporarily exclude exchange-traded derivatives
This report provides an assessment of the need to temporarily exclude exchange-traded derivatives from the scope of Articles 35 and 36 of Regulation on Markets in Financial Instruments. View Article |
MiFID II: ESMA publishes transitional transparency calculations for bonds and updates calculations for two other asset classes
ESMA has updated its transitional transparency calculations for non-equity instruments in relation to the implementation of the Markets in Financial Instruments Directive/ Markets in Financial Instruments Regulation. View Article |
ESMA updates Q&A on MiFID II implementation
ESMA published updated its Questions and Answers document regarding the implementation of the Markets in Financial Instruments Directive and Regulation. View Article |
Financial Times: US derivatives regulator warns EU over clearing plans
The top US derivatives regulator has issued a stark warning to the European Union against changes to the way it oversees foreign clearing houses, warning that a unilateral move by the bloc would be “a violation of trust and co-operation.” View Article |
Bloomberg: UK's bid to retain Euro clearing after Brexit gains EU allies
Sweden said a European Union proposal to allow authorities to force the biggest foreign derivatives-clearing firms to set up shop in the bloc could prove excessive, according to a document that summarizes the positions of 10 national governments. View Article |
ESMA agrees to prolongation of short selling ban by Spanish CNMV
ESMA issued an official opinion agreeing to the prolongation of an emergency short selling prohibition by the Comisión Nacional del Mercado de Valores on net short positions in Liberbank, S.A. shares under the Short Selling Regulation. View Article |
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Clients Union |
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IFAC: Global audit, ethics and education standards boards outline need
The global standard-setting boards for auditing, accounting ethics and accounting education today released a new publication showcasing observations and potential ways to enhance professional skepticism. View Article |
IFAC: IESBA proposes revised ethical requirements prohibiting improper inducements
The IESBA released for public comment proposals that strengthen the Code of Ethics for Professional Accountants by clarifying the appropriate boundaries for the offering and accepting of inducements. View Article |
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Insurance |
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Insurance Europe: Response provided to IAIS consultation on ICP 1 and 2
Insurance Europe has responded to the International Association of Insurance Supervisors’ (IAIS) consultation on revisions to Insurance Core Principle (ICP) 1 on objectives, powers and responsibilities of the supervisor and ICP 2 on the supervisor. View Article |
GVNW's Mahnke: Solvency II interpretation threatens Germany as viable captive option
GVNW president Alexander Mahnke is concerned that the strict interpretation of captives under Solvency II in Germany means German companies may have to rethink whether their home country is the best domicile for such risk transfer vehicles. View Article |
OECD: Technology and innovation in the insurance sector
Innovation through new technologies is a key driver of change in the financial sector - the insurance sector is no exception to such developments, with possibilities of new methods of service provision as well as greater opportunities for data collection and fraud detection, which are being referred to as “InsurTech”. View Article |
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Asset Management |
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Hedgeweek: Asset managers risk missing MiFID II and PRIIPs deadline
Asset managers may miss the deadlines of their insurance and wealth management partners for MiFID II and PRIIPs data delivery as they’re too focused on the end of year regulatory starting point and ignoring full preparation time. View Article |
Hedgeweek: Hedge Fund Standards Board becomes Standards Board for Alternative Investments
The Hedge Fund Standards Board (HFSB), the global standard-setting body for the alternative investment industry, has changed its name to the Standards Board for Alternative Investments (SBAI). The new name reflects the evolution of the industry and the ongoing development of the SBAI as it enters its second decade. View Article |
Investment & Pensions Europe: BRSG: DC plans to strengthen German system, says WTW
New defined contribution (DC) plans will strengthen funded pensions in Germany if they are widely accepted by employers and workers, according to Willis Towers Watson. View Article |
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Corporate Governance/Accounting |
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IASB publishes ED to clarify how to distinguish accounting policies from accounting estimates
The IASB has published for public consultation proposed narrow-scope amendments to IAS 8 Accounting Policies, Changes in Accounting Estimates and Errors. View Article |
Accountancy Europe: EFRAG’s preliminary response to IASB Discussion Paper on Principles of Disclosure
Accountancy Europe responded to EFRAG’s preliminary responses to the questions in the IASB Discussion Paper DP/2017/1 Disclosure Initiative – Principles of Disclosure. View Article |
FRC: Commission report on monitoring progress of the EU audit reform
The FRC as the UK’s competent authority for audit contributed to the first report on the EU market for Public Interest Entity (PIE) audit which has now been published. View Article |
ICAEW: IFRS 9 - Briefing paper for analysts and other market participants
ICAEW's paper said one of the major outcomes of the financial crisis was a fundamental review of how banks account for loan losses. The new accounting standard, IFRS 9, will require banks to show their losses earlier than in the past. View Article |
ICGN: 'Investors faced with regulatory schizophrenia on governance'
High corporate governance standards and shareholders’ rights are under threat from a race to the bottom by regulators and stock exchanges, the executive director of the International Corporate Governance Network (ICGN) has argued. View Article |
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Financial Services Policy |
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ESMA sees valuation risk at highest levels due to financial weakness and geopolitical uncertainty
ESMA’s latest report on Trends, Risks and Vulnerabilities identifies high asset price valuations as the major risk for European financial markets in the second half of 2017. View Article |
Hedgeweek: Political uncertainty has delayed preparation for new regulatory compliance, says DST
New research by technology, strategic advisory, and operations outsourcing company DST shows that political uncertainty surrounding Brexit and the result of the last UK general election has delayed the regulatory compliance process of one in four financial services firms. View Article |
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Grahams Articles, Comments & Speeches |
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“Eurobills” as a Safe Asset that blends Fiscal Rules progressively with Market Discipline
Graham Bishop's response to the European Commission Reflections on Deepening EMU. View Article |
Graham Bishop's evidence to House of Lords EU Committee – Financial Affairs on Financial Regulation and Supervision following Brexit
Graham Bishop's Evidence for this Enquiry focusses on the issues of “adequately aligned regulation and financial stability”, given the international influence from the FSB and BCBS. It relates principally to Questions 2, 6, 14 and 15. View Article |
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Temporary Eurobill Fund (TEF) |
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“Eurobills” as a Safe Asset that blends Fiscal Rules progressively with Market Discipline
Graham Bishop's response to the European Commission Reflections on Deepening EMU. View Article |
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Political |
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President Jean-Claude Juncker's State of the Union Address 2017
The Commission President laid out his vision for a more unified and politically-accountable EU after Brexit, which would combine the presidencies of the Commission and the Council, complete the euro currency zone, and push the bloc to take “a democratic leap forward” in unison and at a single speed. View Article |
Andrew Duff: Is the European Parliament missing its constitutional moment? The asymmetric bet of Europe
Circumstances have thrown the European Parliament a golden opportunity to take a major step in the federal direction – but it looks as though MEPs are going to retreat again, writes Duff in Verfassungsblog. View Article |
POLITICO: MEPs propose cut in their ranks after Brexit
MEPs want to shrink the size of the European Parliament after Britain leaves the EU, and opened the door for a future pan-European list of lawmakers, according to a draft report obtained by POLITICO. View Article |
Open Europe: How the German elections may affect Brexit
Leopold Traugott assesses the possible outcomes of the election, and how they may influence Berlin’s position in negotiations over Brexit and future UK-EU relations. View Article |
LSE: Germany’s election: Behind consensus politics lie conflicting ideas of Europe
There is a clash between two different visions of Europe in the German elections debate: further integration by strengthening European institutions, and gradual integration by making the Union even more inter-governmental, with a de-politicised Commission and a transformed ESM. View Article |
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Financial |
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Jørgen Ørstrøm Møller: The Eurozone Is Underrated
Reforms are still needed, but the system works a lot better than the conventional wisdom maintains, the author writes in the latest issue of The International Economy. View Article |
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Economic |
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Insurance Europe: Response to OECD discussion draft on BEPS Action 7
Insurance Europe has responded to the Organisation for Economic Co-operation and Development’s (OECD) discussion draft on its base erosion and profit shifting (BEPS) Action 7. View Article |
August 2017: Economic Sentiment continues to rise in the euro area, broadly stable in the EU
The Economic Sentiment Indicator (ESI) for the euro area rose again in August, increasing slightly by 0.6 points to 111.9, its highest level in more than 10 years. The indicator for the EU remained broadly stable (-0.3 points to 111.9), just below its 10-year high of July. View Article |
Employment up by 0.4% in both the euro area and in the EU28
The number of persons employed increased by 0.4% in both the euro area (EA19) and in the EU28 in the second quarter of 2017 compared with the previous quarter, according to national accounts estimates published by Eurostat. View Article |
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Graham's tweets |
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© Graham Bishop
Banking Union