This week in "Brussels"
21 February 2019
EU ambassadors endorse full package of risk reduction measures in banking, Mario Draghi replacement candidates, new EBA Chairperson, ESMA supervision work programme, agreement on data transfer, MiFID II and more.
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Articles from 14 February 2019 - 21 February 2019 |
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Banking Union |
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European Council: Banking Union: EU ambassadors endorse full package of risk reduction measures
The EU will soon have in place a more robust framework to regulate and supervise banks. EU ambassadors endorsed an agreement reached between the Romanian presidency and the Parliament on a set of revised rules aimed at reducing risks in the EU banking sector. View Article |
Bloomberg: The two Finns fighting to replace Mario Draghi
Erkki Liikanen and Olli Rehn are both candidates for the position of ECB chief. Finland could offer a compromise contender to Germany and France. View Article |
EBA Board of Supervisors nominates José Manuel Campa as new EBA Chairperson
The Board of Supervisors (BoS) of the EBA nominated Jose Manuel Campa as the new Chairperson of the Authority. Mr Campa was selected from a shortlist of candidates compiled by the EBA Selection Committee. View Article |
EBA publishes Consumer Trends Report for 2018-19
The Report covers the trends and issues related to retail banking products and services that fall within the EBA's consumer protection mandate, such as mortgages, consumer credit, deposits, payment accounts, payment services and electronic money. The Report also provides an overview of the topical issues identified in 2018/19 that impact or may impact consumers. View Article |
ECB: Working paper: Monetary policy transmission to mortgages in a negative interest rate environment
The paper examines whether the introduction of negative policy interest rates hinder banks’ transmission of monetary policy. To that effect, the paper uses a novel loan-level dataset to compare the behaviour of mortgage lending rates in the Italian market before and after the introduction of a negative deposit facility rate by the ECB in June 2014. View Article |
European Parliament: EU cross-border payments outside Eurozone: MEPs scrap excessive fees
Banks should charge equally for cross-border payments in euro and domestic payments and make currency conversion costs transparent, say new rules. View Article |
EPC: Publication of clarification paper on SCT and SCT Inst rulebooks and adherence pack to the SCT ERI option
The European Payments Council has released the version 1.3 of the EPC clarification paper on the Single Euro Payments Area (SEPA) Credit Transfer (SCT) and SEPA Instant Credit Transfer (SCT Inst) rulebooks. View Article |
EPC: Call for change requests to the SEPA proxy lookup (SPL) scheme rulebook
The call for change requests for possible modifications to be introduced into the SEPA Proxy Lookup (SPL) scheme rulebook runs until 31 March 2019. View Article |
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Capital Markets Union |
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ESMA supervision to focus on data, Brexit and cybersecurity in 2019
The ESMA has published its 2019 Supervision Work Programme, which details the main areas of focus for the upcoming year for ESMA’s supervision of Trade Repositories (TRs), Credit Rating Agencies (CRAs), and the monitoring of third-country market infrastructures such as third-country central clearing counterparties (TC-CCPs) and third-country Central Securities Depositories (TC-CSDs). View Article |
EU and global securities regulators welcome agreement on data transfer
IOSCO and ESMA welcome the Opinion of EDPB on their administrative arrangement for the transfer of personal data between European Economic Area Financial Supervisory Authorities and non-EEA Financial Supervisory Authorities. View Article |
Investment & Pensions Europe: MiFID II research rules ‘hitting sector coverage and quality’
A cut in spending on research by fund managers, caused by MiFID II rules, could be leading to poorer coverage of some sectors of the equity market, surveys of the industry have found. View Article |
MIFID II: ESMA issues latest double volume cap data
The European Securities and Markets Authority has updated its public register with the latest set of double volume cap (DVC) data under the Markets in Financial Instruments Directive. View Article |
MiFID II integrating sustainability risks and factors: EBF response
EBF would like to clarify the scope of the proposal, as the mandate of the Commission is clear, focusing on firms offering portfolio management and investment advice services, while ESMA seems to go beyond. As to avoid uncertainty or negative impacts, ESG principles shall be included in MiFID after the legislative proposals are finalised, all definitions adopted and fully operational. View Article |
EFAMA’s comments on ESMA’s consultation paper on integrating sustainability risks and factors in MiFID II
EFAMA agrees with ESMA’s suggestions to integrate sustainability risks within the MiFID II requirements through high-level principles. They allow for a proportionate consideration of ESG factors and risks by investment firms at a time when the sustainable investment market is rapidly developing, and discussions on the wider regulatory framework are not yet finalised (e.g. taxonomy). View Article |
BIS: Over-the-counter market liquidity and securities lending
This paper studies how over-the-counter market liquidity is affected by securities lending. Authors combine micro-data on corporate bond market trades with securities lending transactions and individual corporate bond holdings by US insurance companies. View Article |
The Bank of England's supervision of financial market infrastructures - Annual Report 2019
The FMI Annual Report sets out how the Bank has exercised its responsibilities in respect of supervising financial market infrastructure over the past year. It also outlines the Bank’s domestic and international policy work to strengthen the regulatory and supervisory frameworks for FMIs, and sets out the Bank’s priorities for its FMI work in 2019. View Article |
ESMA renews binary options prohibition for a further three months from 2 April 2019
The European Securities and Markets Authority has agreed to renew the prohibition of the marketing, distribution or sale of binary options to retail clients, in effect since 2 July 2018, for a further three-month period. View Article |
ESMA issues positive opinion on short selling ban by BaFin
The ESMA has issued an official opinion agreeing to an emergency net short position ban, for a period of two months, by the Bundesanstalt für Finanzdienstleistungsaufsicht (BaFin) on net short positions in Wirecard AG (Wirecard) shares under the Short Selling Regulation. View Article |
ESMA calls for fund experts to join industry panel
The European Securities and Markets Authority has issued a call for candidates in order to renew the composition of its Consultative Working Group (CWG) which advises ESMA’s Investment Management Standing Committee (IMSC). View Article |
ECB: Working paper: The anatomy of the euro area interest rate swap market
This paper uses a number of perspectives to investigate the anatomy of the euro area IRS market. In particular, authors explore notional measures as well as observed transaction prices. They move from the transaction level to the level of aggregate exposures. Their approach provides new evidence to regulators and policy makers regarding the structure and activity in the IRS market. View Article |
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Clients Union |
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Insurance Europe: Call for expiry date of PRIIPs derogation for multi-option products to be aligned with end of UCITS exemption
Current rules allowing the use of information documents prepared under the UCITS Directive for multi-option products (MOPs) under the packaged retail investment and insurance products (PRIIPs) Regulation must be urgently extended in order to ensure consumers can continue to receive pre-contractual information about these products. View Article |
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Insurance |
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FCA publishes Wholesale Insurance Brokers Market Study final report
The Financial Conduct Authority (FCA) has published the final report of its Wholesale Insurance Brokers market study which was launched in November 2017 to assess how competition was working in the sector. View Article |
Insurance Europe: US Base Erosion and Anti-abuse Tax discriminates against non-US affiliate reinsurers
Insurance Europe explains that it is because it applies to gross premiums paid to foreign affiliate reinsurers, but not to premiums paid to US-based affiliate reinsurers for the same type of transaction. The proposed regulations do nothing to change this fact. View Article |
Insurance Europe: Unions and insurers issue joint warning about burden of significant increase in EU regulation on insurance workers
Insurance Europe, along with the European social partners in the Insurance Sectoral Social Dialogue Committee (ISSDC), has signed a joint declaration on the negative social effects of the recent significant increase in EU regulatory requirements in financial services. View Article |
Ed Sibley: Towards a more resilient insurance industry
Ed Sibley, Deputy Governor (Prudential Regulation) of the Central Bank of Ireland, outlined several challenges insurance industry is facing, and mainly focused on resilience and how it pertains to insurance. View Article |
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Asset Management |
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ECB: Euro area investment fund statistics: fourth quarter of 2018
The outstanding amount of shares/units issued by investment funds was lower than in the third quarter. Investment funds reduced their holdings of both equity and debt securities. In terms of investment funds by type, the largest transactions were recorded in bond funds. View Article |
ALFI’s comments on ESMA’s consultation paper on integrating sustainability risks and factors in the UCITS Directive and AIFMD
ALFI strongly supports the initiative of the Commission to promote sustainable finance. However, ALFI would like to point out that ALFI commented in October 2018 that the proposal required certain adjustments and clarifications for it not to be a missed opportunity. View Article |
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Corporate Governance/Accounting |
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Accountancy Europe: Digitalising EU listed companies’ financial information
Accountancy Europe´s factsheet provides an overview of these digital reporting requirements, including practical advice for preparers of financial information and the implications for statutory auditors. View Article |
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Anti-Money Laundering |
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EBA opens formal investigation into possible breach of Union law by the Estonian and Danish competent authorities regarding money-laundering
The EBA opened a formal investigation into a possible breach of Union law by the Estonian Financial Services Authority (Finantsinspektsioon) and the Danish Financial Services Authority (Finanstilsynet) in connection with money laundering activities linked to Danske Bank and its Estonian branch in particular. View Article |
ACCA backs the Flag It Up campaign
Complying with anti-money laundering (AML) regulations is high on the agenda for the accountancy and legal professions, but the majority are worried about becoming a target for criminals looking to exploit their professional skills and services to enable money laundering, according to a poll. View Article |
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Financial Services Policy |
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Financial Times: Do we need a global technology regulator for financial services?
Axel P. Lehmann, UBS president of personal and corporate banking and president of UBS Switzerland, and Steffen Kern, chief economist and head of risk analysis at ESMA, write that making effective use of technology's potential will require a new wave of global policy co-ordination. View Article |
Insurance Europe: EU financial services organisations launch FinDatEx platform to improve data exchange
Six European financial services organisations have launched the Financial Data Exchange Templates (FinDatEx) platform to support the development and use of standardised templates to exchange data between European financial sector institutions. View Article |
EU Ecolabel for financial products questionnaire: EBF response
This questionnaire is designed to inform the development of EU Ecolabel criteria for financial products addressed to retail investors. The EU Ecolabel criteria will define the minimum environmental performance of this product group and will be based on the requirements of the EU Ecolabel Regulation 66/2010. View Article |
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Political |
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CEPS: What comes after the last chance Commission?
Ahead of the 2019 institutional reconfiguration of the EU is a fitting moment to take stock of the European integration process and decide which priorities should define the strategic agenda of the next generation of incumbents. View Article |
POLITICO: Right wing set for big gains in European election
Right-wing, populist forces are set to make major gains in the European election, according to the European Parliament's first official poll. View Article |
POLITICO: Spain could get right-wing government, survey suggests
Right-of-center parties could win enough votes to oust Spain's Socialist government in April's snap election, according to a survey published Saturday by El País. View Article |
Project Syndicate: Europe’s Power Deficit
The new Treaty of Aachen is important for its historical symbolism, but it should not be viewed as an adequate response to the EU's organizational and strategic deficiencies. The EU must re-establish itself as a sovereign power, in every sense of the term, writes Janusz Reiter. View Article |
ABC Nyheter: EEA Crisis in Norway
ABC Nyheter reports about the debate opened in Norway on its trade relationship with the European Union. View Article |
Bloomberg: EU Elections: Has populism peaked?
A Bloomberg analysis suggests that even a strong showing by nationalists won’t necessarily translate into power over legislation, and the European Union ballot might instead prove to be the high-water mark for the insurgents. View Article |
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Economic |
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EurActiv: France, Germany call for a change of European regulatory rules
Less than two weeks after the European Commission blocked the merger of Siemens and Alstom, France and Germany published a joint industrial manifesto calling for the EU merger rules to be changed. View Article |
ECA remarks in brief on the EC’s legislative proposals for the next multiannual financial framework
The ECA has issued a new publication summarising the main remarks submitted to the European Parliament and the Council for use when discussing and deciding upon the EC’s proposals for the 2021-2027 multiannual financial framework (MFF). View Article |
Accountancy Europe: Modernising VAT - EU policy developments
Accountancy Europe´s factsheet provides an overview of current EU VAT initiatives, for persons with a working knowledge of the European VAT system. The most significant revisions are within Anti-fraud measures. View Article |
Euro area international trade in goods surplus €17.0 bn
The first estimate for euro area (EA19) exports of goods to the rest of the world in December 2018 was €176.5 billion, a decrease of 2.5% compared with December 2017 (€181.0 bn). View Article |
GDP up by 0.2% and employment up by 0.3% in the euro area
Seasonally adjusted GDP rose by 0.2% in both the euro area (EA19) and the EU28 during the fourth quarter of 2018, compared with the previous quarter, according to a flash estimate published by Eurostat. View Article |
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Graham's tweets |
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© Graham Bishop
Banking Union