This week in "Brussels"
04 December 2014
Headlines include: Reuters: ECB's Nouy says banks must show they can make profits, ECB: Weak economic prospects exacerbate financial system risks.
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Articles from 27 November 2014 - 04 December 2014 |
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Banking |
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Reuters: ECB's Nouy says banks must show they can make profits
Euro zone banks that failed or scraped through this year's health checks will have to demonstrate they can make sustainable profits and may need to sell off loss-making units, the European Central Bank's top banking supervisor said. |
ECB: Weak economic prospects exacerbate financial system risks
Systemic stress among euro area banks and sovereigns declined further to levels last seen before the onset of the global financial crisis in 2007, according to the latest Financial Stability Review. |
ECB: Retail market structure and consumer prices in the euro area
The study uses micro-data from ACNielsen on chain stores' census characteristics and price levels for a broad variety of products. |
EBA published an opinion on the perimeter of credit institutions
The Opinion is based on a report that focuses on the interpretation of the term ‘credit institution' and the prudential treatment of entities that carry on credit intermediation but are not ‘credit institutions'. |
EBA consults on criteria for determining the minimum requirement for own funds and eligible liabilities (MREL)
To avoid institutions structuring their liabilities in a way that hampers the effectiveness of bail-in or other resolution tools, the BRRD requires institutions to meet a robust minimum requirement for MREL. |
Bank of England: CRD IV: Liquidity
This consultation paper seeks views on draft rules and a draft supervisory statement which set out the PRA’s proposed update to its liquidity regime. |
Bank of England and HM Treasury announce extension to the Funding for Lending Scheme
The one-year extension will provide lenders with continued certainty over the availability of cheap funding to support lending to SMEs during 2015, even in the event of stress in bank funding markets. |
EBF underlined need to match EFSI funds with stable economic framework
The European Banking Federation sees the creation of the European Fund for Strategic Investment as a first important step towards a European Union agenda that is more focused on growth and jobs. |
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Securities |
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Markets Media: The new normal of regulatory compliance
Derivatives market participants are preparing their businesses to take advantage of volume growth and new revenue opportunities in the future. |
Financial Advisor: Managers using more OTC derivatives
The often exotic hedging strategies used in over-the-counter (OTC) derivatives swaps contracts are back in favor with portfolio managers. That’s the view of several fund managers, some of whom question whether they were ever out of favor despite the market meltdown of 2008. |
Bloomberg: Wall Street called out by regulators for stalling on swaps rule
JPMorgan Chase & Co., Citigroup Inc. and other lenders have already won one delay of the measure that forces them to move derivatives out of units with federal backstops. |
Financial News: FTT stalls on derivatives agreement
The 11 European countries attempting to introduce a financial transactions tax in 2016 are still debating how the tax would apply to derivatives, raising doubts about an agreement on the levy as planned by the end of this year. |
FOW: Clearing looks ahead to new dawn
Clearing has emerged in the post-crisis financial market as the key battleground for modern exchanges. A clearing house is now seen by many markets as a crucial strategic asset. |
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Insurance |
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European Commission: Insurance stress test - a full and rapid implementation of the "Solvency II" insurance regulatory regime is needed
Jonathan Hill: “These were serious and thorough stress tests. The results show that the European insurance sector is, broadly speaking, in good health." |
EIOPA announces results of the EU-wide insurance stress test 2014
The insurance sector is in general sufficiently capitalised in Solvency II terms. |
EIOPA launched public consultation on the Solvency II standards and guidelines
With this consultation EIOPA enters the final regulatory phase of Solvency II. |
EIOPA published the outcome of the public consultation related to the first set of the draft Guidelines for Solvency II
These Guidelines complement the first set of Implementing Technical Standards. |
EIOPA issues sound principles for crisis prevention, management and resolution
The Opinion is a follow-up to a survey that EIOPA carried out in 2013 in order to obtain a better understanding of the current approaches and practices across the European Union. |
EIOPA publishes its third Consumer Trends Report
The report provides an overview of trends in various Member States of the EU that may have led, or may lead in the future, to consumer detriment in the insurance and pensions markets. |
Fitch: Weak profits, Solvency II may drive more EU insurance M&A
Low interest rates have driven down profits across Europe and business models have come under strain from reforms in some markets. |
EIOPA: Consultation paper on powers for banning insurance-based investment products
EIOPA is preparing its technical advice on measures specifying the criteria and factors to be taken into account in determining when there is a significant investor protection concern or a threat to the orderly functioning and integrity of financial markets. |
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Asset Management |
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ESMA submits advice on delegated acts required by the UCITS V Directive
The new report sets out ESMA’s final advice to the Commission in light of the feedback from stakeholders. |
ESMA consults on AIFMD asset segregation requirements
The depositary provisions – in particular those on asset segregation – are a key aspect of the AIFMD framework and are aimed at improving investor protection. |
EIOPA’s fact finding report on decumulation phase practices
The survey explored all different types of occupational pension schemes provided by IORPs and the decumulation phase options that they can offer to members. |
Hedgeweek: What will happen to the hedge fund industry if we experience a 2008-type market decline?
With interest rates and credit spreads near historic lows and equity valuation above historical averages, many people are concerned that the Federal Reserve, by artificially keeping rates low, has created an asset bubble in the capital markets where many securities are priced to perfection. |
EFAMA welcomes Trilogue agreement on European long-term investment funds
EFAMA views this as a concrete step towards meeting Europe’s pressing needs for financing growth and long-term development. |
IPE: Final IORP II draft ahead relaxes depository, prudent person rules
Some in the industry remain concerned that the draft continues to refer to IORPs as financial service providers, omitting wording that previously said they should be regarded as institutions with a “specific social purpose”. |
IPE: Regulatory expectations of engagement a systemic flaw
It is unrealistic of regulators and organisations to expect investors to engage with all of their holdings, USSIM co-head of responsible investment says. |
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Corporate Governance/Accounting |
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IASB/Hans Hoogervorst: 'Building a credible Capital Markets Union'
Why the success of Europe’s Capital Markets Union largely depends on its ability to attract capital from around the world, and why a vital ingredient in achieving this goal is internationally accepted financial reporting standards. |
IASB: Investors in Financial Reporting programme launched
Created with the support of some of the world’s leading asset managers and owners, the programme is designed to foster greater investor participation in the development of IFRS. |
ESMA’s Steven Maijoor delivers speech at Henri Sijthoff Prijs 2014
Maijoor focuses on how the adoption of International Financial Reporting Standards has contributed to the quality of financial reporting and to the development of the EU Single Market. |
EFRAG: Effects analysis is an important step in the IASB standard-setting process
It is a positive response to Europe’s long standing call for effect analyses to be conducted by the IASB before any IFRS would be published. |
Insurance Europe's response to the Discussion Paper on amortization of goodwill
Insurance Europe welcomes that the paper analyses various aspects of existing and potential disclosure requirements on goodwill impairment. |
ACCA: Tax policy makers need to understand what they’re trying to achieve
Policymakers should clearly communicate the aim of each tax measure to enable taxpayers to understand what is expected of them and should publish clear advice along with the results of tax negotiations. |
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Financial Services Policy |
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AFME proposes an agenda for capital markets union
A central goal for CMU should be to increase the overall share of debt financing from the capital markets in Europe from the current 25% to at least 35%. This should be achieved without further reducing the ability of Europe’s banks to provide credit to the real economy. |
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Grahams Articles, Comments & Speeches |
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Difficulty of dealing with an age-old problem
Long and short run problems for Europe: Demographics and Sterling. |
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Think Tanks/EP groups |
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Bruegel: The ECB’s balance sheet, if needed
The ECB has become a safety net for dealing with near-insolvency conditions. |
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© Graham Bishop
Banking