Friends 'Weekly' Newsletter

07 April 2016

Basel Committee, RWAs, bonus cap, STS securitisation, OTC, MiFID II, CCPs, ESMA, CMU, Solvency II, UCITS, Brexit and more.

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  Articles from 24 March 2016 - 07 April 2016

  Banking
 
 
Second report on risk-weighted assets in the banking book published by the Basel Committee
The Basel Committee on Banking Supervision has published a second report on RWAs in the banking book, as part of its Regulatory Consistency Assessment Programme (RCAP) to ensure full and effective implementation of the Basel III framework.
Basel Committee proposes measures to reduce the variation in credit risk-weighted assets
The BCBS released a consultative document entitled "Reducing variation in credit risk-weighted assets - constraints on the use of internal model approaches", which sets out a proposed set of changes to the Basel framework's advanced IRB approach and the foundation internal ratings-based approach.
Revisions proposed to the Basel III leverage ratio framework and answers to frequently asked questions issued by the Basel Committee
The Basel Committee on Banking Supervision released a consultative document entitled Revisions to the Basel III leverage ratio framework, and responses to a third set of FAQs.
EBA consults on draft amending standards on CVA proxy spread
The EBA launched a public consultation on draft amending RTS on CVA proxy spread. Through the proposed amendments the EBA expects to ensure a more adequate calculation of own funds requirements for CVA risk.
EBA reports on high earners and the effects of the bonus cap
The EBA report on remuneration practices published shows that the number of high earners in EU banks increased significantly in 2014, while the average ratio between the variable and fixed remuneration dropped significantly for high earners, as well as for all other identified staff.
 
  Securities
 
 
PCS: A new joint-note shows the depth of consensus over the European Commission’s securitisation proposals
A note on STS securitisation signed by 32 associations and market participants sets out aspects of the Commission’s simple, transparent and standardised securitisation proposals that would need modifications if the project is to revive the European securitisation market.
BIS launched the 2016 Triennial Central Bank Survey of Foreign Exchange and OTC Derivatives Markets
Preliminary results for turnover will be published by the BIS in early September 2016, and for amounts outstanding in early November 2016. The final, comprehensive results will be published in December 2016.
MiFID II – ESMA: no need to temporarily exclude ETDs from open access to trading venues and CCPs
MiFIR requires ESMA to assess whether exchange traded derivatives should be exempted for a period of 30 months from the non-discriminatory access provisions.
ESMA issues amended rules for access, aggregation and comparison of data across trade repositories
ESMA published amended RTS implementing the European Market Infrastructure Regulation that deal with the access, aggregation and comparison of data across trade repositories.
EMIR: ESMA proposes one-day margin period of risk for CCP client accounts
ESMA's RTS detail the margin period of risk for CCP client accounts, e.g. the amount of initial margins collected by a CCP. The amended RTS would allow EU-based CCPs to margin on a one-day MPOR basis.
ESMA consults on future MAR list of information regarding commodity and spot markets
The consultation contains information on the background and mandate and provides examples of information relating directly and indirectly to commodity derivatives and information directly relating to a spot market contract. It also contains a proposal of guidelines.
 
  Insurance
 
 
European Commission: Capital Markets Union - Making it easier for insurers to invest in infrastructure
As a result of one of the first measures in the Capital Markets Union Action Plan, insurers will find it more attractive and cheaper to invest in infrastructure projects as of 2 April 2016.
EIOPA consults on amendments for the supervisory reporting templates and Guidelines on Reporting and Disclosure under Solvency II
This EIOPA’s amendment introduced tailored treatments to insurers' investments in infrastructure, in European Long-Term Investment Funds (ELTIFs) and in equities traded through multilateral trading platforms.
EIOPA issues Guidelines on the supervision of branches of third-country insurance undertakings
The EIOPA issued its Guidelines on the supervision of branches of third-country insurance undertakings under Solvency II. The objective of these Guidelines is to ensure a consistent, efficient and effective consumer protection within the European Union.
 
  Asset Management
 
 
PensionsEurope response to the Commission consultation on long term and sustainable investments
PensionsEurope wrote that European pension funds recognise that, with their long-term investment horizons, a key consideration must be to look both at the returns on their investments and any associated risks.
FEE responds to Commission’s consultation on long-term and sustainable investment
FEE has responded to the EC‘s consultation on long-term and sustainable investment, which seeks to establish the role of environmental, social, governance issues in investment decisions and to identify if any obstacles exist to longer-term, sustainable investment.
ESMA publishes Discussion Paper on UCITS share classes
The DP describes the nature of share classes, the reasons for their existence and the key elements of share classes.
Financial Times: EU rules set to hurt City and asset managers
The Commission delegated regulation supplementing Regulation No 596/2014 of the EP and of the Council is an important document, since it tears up working practices across the City and other European financial centres. And it’s coming to a statute book very soon.
 
  Corporate Governance/Accounting
 
 
ESMA: Report on Enforcement and Regulatory Activities of Accounting Enforcers in 2015
The report issued by ESMA provides an overview of the activities of ESMA and the accounting enforcers in the EEA when examining compliance of financial information provided by issuers listed on regulated markets with the applicable financial reporting framework in 2015.
 
  Financial Services Policy
 
 
The EPC publishes its response to the European Commission’s Green Paper on Retail Financial Services
In the EPC's opinion, the Commission’s main goal is to make it easier for companies wanting to offer retail financial products in other EU Member States. This, in turn, will give consumers access to a far greater range of services.
 
  Friends Services
 
 
Deepening EMU – Round-up of Key Events – March 2016
The UK Government published two reports on the process for withdrawing from the EU and the possible alternatives to EU membership. The CBI and the City of London Corporation made the case for staying In. The EU Council published the Annual Growth Survey and several documents of conclusions on taxes.
Should supporters of free markets support Britain’s continuing membership of the EU?
Speech by Graham Bishop at the Institute of Economic Affairs (IEA) Dinner.
 
  Political
 
 
David Cameron: Britain's choice: economic security with the EU, or a leap into the dark
British Prime Minister writes in The Telegraphthat "no real-world alternative to EU membership would come close to what we have now". The British PM says that "thousands of financial services firms could be forced to move staff or entire offices out of the UK and into the EU" if Brexit happens.
UK Parliament: Government should focus on positive vision for future EU reform
The Lords EU Committee today publishes a report inviting the Government to set out a positive, inclusive vision of the UK's role in a reformed European Union ahead of the referendum on EU membership.
British Influence: Future UK Trade Patterns - Fantasy & Reality
This paper considers what it would be like for the UK to trade with the EU on the same terms as other non-member countries, including whether increased trade with emerging markets would be an adequate substitute for trade with the EU.
BBA: UK banking sector believes Brexit would have “negative impact” on their business
According to a survey by the BBA, a majority of member banks based in the UK which responded believe their business would suffer a “negative impact” if the UK left the European Union.
 

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