This week in "Brussels"
22 November 2018
ECB guide to internal models, Banking Union, benchmark regulation, G-SIBs, EBA's regulatory review of the internal ratings-based (IRB) Approach, CCP resolution, OTC derivatives reforms, uncleared swap margin requirements, proposed delay in IFRS 17, MAR and more.
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Articles from 15 November 2018 - 22 November 2018 |
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Banking Union |
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ECB guide to internal models
Based on the current applicable European Union and national law, the ECB guide to internal models provides transparency on how the ECB aims to apply the relevant rules consistently when assessing whether institutions meet those requirements. View Article |
Remarks by M. Centeno following the Eurogroup meeting of 19 November 2018
The meeting called in order to continue discussion on deepening EMU focused on three main building blocks: Banking Union, ESM reform and the instruments for competitiveness, convergence and stabilisation. View Article |
Financial Times: EU bank stress tests should be redesigned, says watchdog head
The outgoing head of the European Banking Authority has questioned the value of its stress tests of lenders’ balance sheets, arguing that elements of them are no longer “tenable” and need a redesign. View Article |
ISDA: Briefing on the need to extend the transition period of the benchmark regulation
ISDA is among 4 trade associations who request EU policymakers to extend the transition period of the Benchmark Regulation for critical and non-critical benchmarks due to significant negative implications for financial stability in European and global financial markets and competitive disadvantages for European companies. View Article |
Basel Committee publishes more details on global systemically important banks
The Basel Committee on Banking Supervision published further information related to its 2018 assessment of global systemically important banks (G-SIBs), including additional details to help understand the scoring methodology. View Article |
EBA publishes final draft technical standards on the specification of an economic downturn
These RTS complete the EBA's regulatory review of the internal ratings-based (IRB) Approach, with the objective of restoring market participants' trust in internal models by reducing the unjustified variability in resulting risk weighted exposure amounts. View Article |
FSB publishes progress report on measures to address the decline in correspondent banking and updated data
The FSB published updated data on trends in correspondent banking relationships using data provided by SWIFT as of end-2017 and a progress report on the FSB’s four-point action plan to assess and address the decline in correspondent banking that will be delivered to the G20 Summit. View Article |
EPC: Key findings of World Payments Report 2018
EPC interviewed Christophe Vergne, Payment and World Payments Report leader at Capgemini Financial services to know more about the trends in the new payments environment. View Article |
FCA: Bank of England and Financial Conduct Authority appoint new Chair of the Sterling Risk Free Reference Rates Working Group
The Bank of England and Financial Conduct Authority have announced the appointment of Tushar Morzaria as the new Chair of the Sterling Risk Free Reference Rates Working Group. View Article |
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Capital Markets Union |
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FSB publishes 2018 Resolution Report and publicly consults on financial resources to support CCP resolution
The Financial Stability Board published its 2018 Resolution Report and launched for public consultation a discussion paper on financial resources to support central counterparty (CCP) resolution and on the treatment of CCP equity in resolution. View Article |
FSB publishes reports on implementation of OTC derivatives reforms and removal of legal barriers
The FSB published two reports: setting out progress on reforms to over-the-counter (OTC) derivatives markets and reporting on FSB member jurisdictions’ actions to remove legal barriers relating to OTC derivatives trade reporting. View Article |
FSB and standard-setting bodies publish final report on effects of reforms on incentives to centrally clear over-the-counter derivatives
The report by the Derivatives Assessment Team (DAT) evaluates how these reforms interact and how they could affect incentives. View Article |
CFTC approves a final rule to amend uncleared swap margin requirements
The amendments ensure that master netting agreements are not excluded from the definition of “eligible master netting agreement” under the CFTC Margin Rule based solely on such agreements’ compliance with the QFC Rules. View Article |
IOSCO members found mostly compliant with Principles for Commodity Derivatives Markets
The report shows that IOSCO members have made substantial progress towards achieving full compliance and, in many cases, have strengthened their implementation of the Principles. View Article |
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Clients Union |
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UK Finance: Industry delivers commitment on service information for customers
Consumers are now able to compare clearer and more consistent information about the additional services current account providers offer all customers, including those in potentially vulnerable circumstances, after a voluntary commitment made by the finance industry comes into action. View Article |
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Insurance |
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EIOPA: Insurance and pensions: Securing the future
Gabriel Bernardino, Chairman of EIOPA, spoke about EIOPA’s achievements and priorities over the past and coming year: Solvency II and its review, achieving supervisory convergence and consumers' rights. View Article |
Commercial Risk Europe: Proposed delay in IFRS 17 will give insurers time to prepare
The proposed delay in the implementation deadline of the International Financial Reporting Standard (IFRS 17) to January 2022 from January 2021 will allow insurers more time to prepare, ensuring there is no impairment of information quality, according to S&P Global Ratings. View Article |
EIOPA assesses supervisory practices and application of key functions through peer review
The EIOPA published the findings of its peer review assessing how National Competent Authorities (NCAs) supervise and determine whether an insurer's setting of key functions fulfils the legal requirements of Solvency II with a particular emphasis on proportionality. View Article |
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Asset Management |
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Commercial Risk Europe: Pensions regulation: a tougher approach
Globally, the regulatory burden on corporates is on the increase. This is particularly true in relation to workplace pensions, and anyone who is involved in managing corporate risk will need to understand how this shifting regulatory landscape might impact on their business. View Article |
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Corporate Governance/Accounting |
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IFAC recommendations to the G20 focus on rebuilding public trust
IFAC calls upon G20 countries to pursue smart regulation, heightened transparency, and inclusive growth to rebuild trust in institutions and advance global economic progress. View Article |
FRC´s review of 2016 audit standards
The FRC is consulting with stakeholders to determine how effective the changes to ethical and auditing standards in 2016 have been in delivering high quality audit, and whether further steps are now needed to strengthen auditor independence, reduce conflicts, improve quality of independent audit. View Article |
EC: Summary Report of the Public Consultation on the Fitness Check on the EU framework for public reporting by companies
The European Commission has published an outcome on its consultation document 'Fitness Check on the EU Framework for Public Reporting by Companies' issued in March 2018. View Article |
ECA: EU insurance supervision taking shape, but significant challenges remain
The EIOPA has made an important contribution to a common supervisory culture and financial stability in the insurance sector, according to a new report from the ECA. But a number of significant challenges still need to be addressed by the EIOPA itself, by national supervisors and by legislators. View Article |
IAASB seeks public comment on Exposure Draft on agreed-upon procedures
The IAASB seeks public comment on its ED of proposed ISRS 4400 (Revised), Agreed-Upon Procedures Engagements. View Article |
FRC announces 2019/20 audit thematic reviews, priority sectors and audit areas of focus
The FRC will, in 2019/20, supplement its routine AQR monitoring programme with two thematic reviews. These thematic reviews, which focus on aspects of audit practice across a number of firms to identify both scope for improvement and good practice, complement other AQR work. View Article |
FASB proposes narrow-scope improvements to financial instruments standards
The FASB issued a proposed Accounting Standards Update (ASU) that would clarify and improve areas of guidance related to the recently issued standards on credit losses, hedging, and recognition and measurement. View Article |
ACCA´s research reveals 48% of public believe auditors ‘could prevent company failures’
A survey of 1,000 members of the general public by ACCA reveals auditors are expected to play a crucial role in company safeguarding. View Article |
ECGI: Technology and Corporate Governance - Blockchain, Crypto, and Artificial Intelligence
The ECGI has published a working paper written by Mark Fenwick and Erik Vermeulen. Their new paper explores the suggestion that existing models of corporate governance will need to be re-examined in light of the profound disruption to business caused by emerging technologies. View Article |
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Market Abuse |
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ESMA reports on NCAs’ use of sanctions and administrative measures under MAR
ESMA published its first annual report concerning administrative and criminal sanctions as well as other administrative measures issued by National Competent Authorities under the Market Abuse Regulation. View Article |
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Financial Services Policy |
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FSB report finds that effects of G20 financial reforms on infrastructure finance are of a second order relative to other factors
The evaluation is among the first under the FSB framework for the post-implementation evaluation of the effects of the G20 financial regulatory reforms, and forms part of a broader FSB examination of the effects of reforms on financial intermediation. View Article |
Financial Times: ECB official dubs bitcoin ‘evil spawn of the financial crisis'
Benoît Cœuré, a member of the Executive Board of the European Central Bank, became the latest central banker to lay into the cryptocurrency, saying the problems of bitcoin were “plentiful”. View Article |
Project Syndicate: Why central bank digital currencies will destroy cryptocurrencies
Leading economic policymakers are now considering whether central banks should issue their own digital currencies, to be made available to everyone, rather than just to licensed commercial banks. The idea deserves serious consideration, as it would replace an inherently crisis-prone banking system and close the door on crypto-scammers. View Article |
ACCA: Lifelong learning is essential to remain relevant in an ever-changing world
Accountancy professionals will be increasingly required to broaden their skill-set and take ownership of their personal development if they are to succeed in an ever-changing, dynamic world, according to a new report from the ACCA. View Article |
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Financial |
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Commission welcomes agreement on foreign investment screening framework
The European Parliament, the Council and the Commission reached a political agreement on an EU framework for screening foreign direct investment. View Article |
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Economic |
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POLITICO: Commission calls for disciplinary action against Italy over budget plans
Italy should face disciplinary action after “serious non-compliance ” with EU fiscal rules, the European Commission said. View Article |
EU budget for 2019: Conciliation ends without agreement
The Council and the European Parliament ended negotiations on the EU budget for 2019 without agreement. View Article |
Financial Times: The ECB should extend its bond-buying programme
Slowing growth in the eurozone makes quantitative easing as important as ever, writes Melvyn Krauss. View Article |
Annual inflation up to 2.2% in the euro area
The euro area annual inflation rate was 2.2% in October 2018, up from 2.1% in September 2018. A year earlier, the rate was 1.4%. European Union annual inflation was also 2.2% in October 2018, up from 2.1% in September 2018. A year earlier, the rate was 1.7%. View Article |
Euro area international trade in goods surplus €13.1 bn
The first estimate for euro area (EA19) exports of goods to the rest of the world in September 2018 was €184.8 billion, a decrease of 1.0% compared with September 2017 (€186.6 bn). View Article |
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Graham's tweets |
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© Graham Bishop
Banking Union