This week in "Brussels"
14 February 2019
Eurogroup support Philip Lane's candidacy to the ECB executive board, new EU derivatives rules, ESAs recommendations on changes to the PRIIPs KID, Parliament and member states agree on a proposal for a PEPP, Council confirms position on reviewed financial supervision scheme and more.
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Articles from 07 February 2019 - 14 February 2019 |
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Banking Union |
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ECB executive board: Eurogroup gives support to Philip Lane's candidacy
The Eurogroup gave its support to the candidacy of Philip Lane to become a new member of the European Central Bank's executive board. View Article |
Bloomberg: ECB's empty chair embarrassment leaves Draghi in pre-Brexit bind
Sabine Lautenschlaeger has ended her term at the ECB's supervisory arm with no successor in sight. The situation showcases design flaws in governance of the EU banks' watchdog. View Article |
ECB publishes consolidated banking data for end-September 2018
Total assets of credit institutions headquartered in the EU increased year on year by 0.5%, from €33.0 trillion in September 2017 to €33.2 trillion in September 2018. The non-performing loans ratio dropped year on year by 1.0 percentage point to 3.4%. View Article |
BIS: Distributed ledger technology and large value payments: a global game approach
Mr Hyun Song Shin, Economic Adviser and Head of Research of the BIS, uses global game theory to analyse decentralised payment systems built around blockchain technology. View Article |
ECB: Promoting innovation and integration in retail payments to achieve tangible benefits for people and businesses
Yves Mersch says that digitalisation has brought a great deal of change to the payments market, and there is more on its way. The GDPR and PSD2 have been introduced to protect EU citizens and to support competition in payments. View Article |
ECB: Risks to banks – from inside and out
Speech by Sabine Lautenschläger, Member of the Executive Board of the ECB, regarding risks and challenges banks face. Some of these risks and challenges are indeed European, but some are global in scope. And a number of risks are universal in the sense that they emerge from within a bank: weak governance, bad risk management, unethical behaviour. View Article |
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Capital Markets Union |
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ESMA publishes list of thresholds below which an EU prospectus is not required
ESMA published a document listing the thresholds below which an offer of securities to the public does not need a prospectus in the various Member States of the European Union. View Article |
ESMA publishes its 2019 Risk Assessment Work Programme
ESMA has published its Risk Assessment Work Programme, providing an overview of the analytical, research, data and statistical activities that ESMA will carry out in 2019. View Article |
FSB publishes its 2019 work programme
The Financial Stability Board published for the first time its annual work programme. It describes the FSB’s planned work and an indicative timetable of main publications for 2019. View Article |
EUbusiness: New EU derivatives rules to reduce costs and regulatory burdens
The EU Parliament and states reached political agreement on rules applying to non-financial counterparties, small financial counterparties and pension funds using financial derivative products. View Article |
BIS: Central counterparty capitalization and misaligned incentives
This paper investigates for-profit central counterparties, asking whether their incentives might undermine financial stability. View Article |
Euractiv: A new era for securitisation?
The coming into force of the simple, transparent and standardised (STS) securitisation rules in January was intended to mark a fresh start for securitisation within Europe. Richard Hopkin examines the likely effects of the EU’s new rules on securitisation across Europe. View Article |
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Clients Union |
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ESAs publish recommendations on changes to the PRIIPs Key Information Document
ESAs published their final recommendations following a consultation on targeted amendments to the Delegated Regulation covering the rules for the Key Information Document for PRIIPs. View Article |
Commercial Risk Europe: French market demands clarity on insurability of GDPR fines
Law experts have urged French authorities to clarify whether fines imposed on companies for falling foul of the General Data Protection Regulation (GDPR) and other regulations can be covered by insurance. View Article |
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Insurance |
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Commercial Risk Europe: Solvency II has positively impacted captives despite costs, experts say
Three years on from its introduction, Solvency II has had a largely positive impact on captives, an audience of risk professionals was told during the AMRAE conference in Deauville, France. View Article |
Insurance Europe: Updated tool highlights insurers’ consumer-focused practices across EU
Insurance Europe has published an update to its online consumer focus tool, which outlines examples of the work undertaken by Europe’s insurers to provide innovative products and services for consumers. View Article |
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Asset Management |
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Capital Markets Union: Commission welcomes political agreement on new rules to help consumers save for retirement
The Commission welcomes the political agreement reached by the European Parliament and Member States on the proposal for a PEPP. Helping to channel more savings to long-term investments in the EU, the Commission acknowledges that this is an important milestone for the CMU. View Article |
Investment & Pensions Europe: EU member states push back against European regulatory levy
EU member states have rejected proposals from the European Commission that would have extended the European pension regulator’s powers and introduced an industry levy to fund the bloc’s financial regulators. View Article |
EFAMA response to IOSCO consultation on Leverage
EFAMA highlights the low levels of leverage in the European fund sector, evidenced by existing data and emphasizes that the comprehensive EU regulatory framework for measuring leverage has proven, through diverse markets events, its value and risk resilience. View Article |
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Corporate Governance/Accounting |
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IFAC: Global consultation on quality management for firms and engagements
The IAASB seeks public comment on three interrelated standards that address quality management. The proposals bring important changes to the way professional accountancy firms are expected to manage quality—for audits, reviews, and other assurance and related services engagements. View Article |
IFAC: Returns, reinvestment opportunities and dividend distribution
Nick Anderson, member of the IASB, discusses corporate performance and how investors seek to understand the quality of the profit number, not just the amount of earnings. View Article |
ECGI: Do managers successfully shop for compliant auditors? Evidence from accounting estimates
The paper written by Mark DeFond, Jieying Zhang and Yuping Zhao extends the opinion shopping literature by examining whether managers successfully shop for auditors who will allow questionable accounting practices. View Article |
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Market Abuse |
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FCA's Hoggett: Market abuse requires a dynamic response to a changing risk profile
Julia Hoggett, Director of Market Oversight at the FCA, says that firms need effective risk assessments and must consider for themselves the manner in which their systems and controls evolve as the risks within their businesses evolve. View Article |
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Anti-Money Laundering |
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European Commission adopts new list of third countries with weak anti-money laundering and terrorist financing regimes
The Commission has adopted its new list of 23 third countries with strategic deficiencies in their anti-money laundering and counter-terrorist financing frameworks. View Article |
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Financial Services Policy |
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Financial supervision: Council confirms position ahead of negotiations with Parliament
The Council confirmed its position on proposals to review the functioning of the current European system of financial supervision. View Article |
Remarks by Vice-President Valdis Dombrovskis at the ECOFIN press conference
Mr Dombrovskis said that it is important to allow for trialogues to start as quickly as possible and to work with a view of reaching a political agreement between co-legislators on the review of the European System of Financial Supervision before the European elections. View Article |
IOSCO members report having mostly implemented secondary market principles
A report published by the IOSCO Assessment Committee indicates that the implementation of the IOSCO Secondary and Other Market Principles is generally high across most of the member jurisdictions that the committee reviewed. View Article |
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Grahams Articles, Comments & Speeches |
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Running down the ‘atomic bomb’ clock
Once again, Theresa May is putting off the day of reckoning. The UK PM is running talks down to the wire and will ask MPs for more time to try to renegotiate her deal, in hope of delaying a crunch vote in Parliament until Brexit's eve. Prospects for the UK economy never looked so bleak. View Article |
148th Brussels for Breakfast – CPD Notes
Organised by the Centre for the Study of Financial Innovation (CSFI), hosted by Chartered Institute of Securities and Investment (CISI) and with co-presenter Monica Sah (Clifford Chance) and Brian Polk (PWC). View Article |
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Friends Services |
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Running down the ‘atomic bomb’ clock
Once again, Theresa May is putting off the day of reckoning. The UK PM is running talks down to the wire and will ask MPs for more time to try to renegotiate her deal, in hope of delaying a crunch vote in Parliament until Brexit's eve. Prospects for the UK economy never looked so bleak. View Article |
148th Brussels for Breakfast – CPD Notes
Organised by the Centre for the Study of Financial Innovation (CSFI), hosted by Chartered Institute of Securities and Investment (CISI) and with co-presenter Monica Sah (Clifford Chance) and Brian Polk (PWC). View Article |
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Political |
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POLITICO: France fears loss of influence in next European Parliament
Facing heavy losses in May's EP election, France's two traditional major parties risk becoming just bit-part players in the two biggest blocs in the chamber, which, in turn, will mean fewer influential posts for lawmakers and less clout in the Parliament. View Article |
Bloomberg: EU's Tusk plans Polish comeback for 2019 ballot, paper says
European Council President Donald Tusk is planning to return home to Poland to galvanize the opposition in this year’s general election to challenge a nationalist ruling party that’s clashed with Brussels over democratic standards, newspaper Rzeczpospolita reported. View Article |
POLITICO: German CDU chief: Europe must adapt to survive
Europe must change to prosper in a "contest of systems" with China and the United States, according to Annegret Kramp-Karrenbauer, the new leader of Germany's ruling Christian Democrats. View Article |
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Economic |
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European Commission: Winter 2019 Economic Forecast: growth moderates amid global uncertainties
The European economy is expected to grow for the seventh year in a row in 2019, with expansion forecast in every Member State. The pace of growth overall is projected to moderate compared to the high rates of recent years and the outlook is subject to large uncertainty. View Article |
Main results - Economic and Financial Affairs Council
Ministers discussed the architecture of financial supervision, decision-making in EU tax policy and issues related to the EU budget. View Article |
Eurogroup main results
The Eurogroup endorsed the candidacy of Philip Lane for the ECB's executive board. Ministers also held a first exchange of views on the way forward regarding the budgetary instrument for convergence and competitiveness for the euro area. View Article |
European Commission: Agreement with Singapore set to give a boost to EU-Asia trade
The trade and investment agreements between the EU and Singapore have received the approval of the European Parliament. The Parliament has also given its green light to the Partnership and Cooperation Agreement. View Article |
Bloomberg: ECB may delay first rate hike to late 2020, Deutsche Bank says
Economists at Germany’s largest lender predict the European Central Bank will hold back on interest-rate increases until December 2020 as growth in the euro area is “slowing rapidly.” View Article |
ECA examines data behind budget support to partner countries
The ECA is conducting an audit on the reliability of the data underlying nearly one fifth of EU financial aid to partner countries outside the EU. The payments support the EU’s partner countries in their reform efforts and in achieving the United Nations’ sustainable development goals. View Article |
ECB: Working paper: Empowering central bank asset purchases: the role of financial policies
This paper contributes to the debate on the macroeconomic effectiveness of expansionary non-standard monetary policy measures in a regulated banking environment. View Article |
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Graham's tweets |
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© Graham Bishop
Banking Union