Latest news of financial regulation
10 Sep 2014
The Over-the-Counter (OTC) Derivatives Regulators Group (ODRG), issued a report that provides an update to the G20 on further progress in resolving OTC derivatives cross-border implementation issues and identifies a cross-border issue that may call for legislative change.
The ODRG anticipates that it will submit its next report in preparation for the G20 Leaders Summit in November 2014.
11 Sep 2014
At a global level
The BCBS published the results of its latest Basel III monitoring exercise.
A total of 227 banks participated in the current study, comprising 102 large internationally active banks ("Group 1 banks", defined as internationally active banks that have Tier 1 capital of more than €3 billion) and 125 Group 2 banks (ie representative of all other banks).
Data as of 31 December 2013 show that most large internationally active banks now meet the Basel III risk-based capital minimum requirements, and capital shortfalls have been further reduced relative to the target levels. For example, at the Common Equity Tier 1 (CET1) target level of 7.0% (plus the surcharges on G-SIBs as applicable), the aggregate shortfall for Group 1 banks is €15.1 billion, compared to €57.5 billion on 30 June 2013. As a point of reference, the sum of after-tax profits prior to distributions across the same sample of Group 1 banks for the year ending 31 December 2013 was €419 billion.
At a European level
The EBA published its sixth report of the Basel III monitoring exercise on the European banking system.
Results show that the Common Equity Tier 1 capital ratio (CET1) of the largest internationally-active European banks (Group 1 banks) would be on average 10.1% compared to a ratio of 12.4% under the current regulation. Therefore, Group 1 banks would face a CET1 capital shortfall of EUR 0.1 billion to achieve the minimum requirement of 4.5%, and of EUR 11.6 billion to reach the target level of 7.0% or the higher threshold set for global systemically important banks (G-SIBs). The latter capital shortfall would, therefore, be decreased by 68% (from EUR 36.3 billion to EUR 11.6 billion).
5 Set 2014
EU Council Presidency published compromise text on proposed regulation on interchange fees for card-based payment transactions.
Council: agreement on a general approach
10 Set 2014
BCBS issued the results of the trading book test portfolio exercise that was conducted in parallel with the Basel Committee's Basel III monitoring exercise as of 31 December 2013.
This report provides preliminary findings on some of the potential effects of the proposed standards on regulatory capital for market risk:
- Variability of the new risk measures
- Comparison of the new risk measures to current risk measures
- Implementation of varying liquidity horizons
- Impact of constraining diversification and hedging benefits
- Computation of non-modellable risk factors (NMRF) and the incremental default risk measure for equities
03 Sep 2014
Five federal agencies are seeking comment on a proposed rule to establish margin requirements for swap dealers, major swap participants, security-based swap dealers, and major security-based swap participants as required by the Dodd-Frank Act. The proposed rule would establish minimum requirements for the exchange of initial and variation margin between covered swap entities and their counterparties to non-cleared swaps and non-cleared security-based swaps.
The agencies request comments on the proposed rule no later than 60 days after the date of its publication in the Federal Register.
EMIR: ESMA publishes guidelines regarding CPSS-IOSCO principles for financial market infrastructures in respect of central counterparties
04 Sep 2014
ESMA publishes Guidelines regarding CPSS-IOSCO Principles for Financial Market Infrastructures (PFMIs) in respect of Central Counterparties.
These Guidelines and Recommendations concern the implementation of the CPSS-IOSCO PFMIs by competent authorities as part of the exercise of their duties resulting from EMIR for the authorisation and supervision of CCPs pursuant to Article 22(1) of EMIR.
Competent authorities to whom these Guidelines and Recommendations apply must notify ESMA whether they comply or intend to comply with the Guidelines and Recommendations by 04 November 2014.
05 Sep 2014
The Bank of England published its final policy approach to supervising international banks confirming proposals which were consulted on earlier this year. This sets out how the Prudential Regulation Authority (PRA) will supervise UK branches of banks based outside the European Economic Area (EEA) and also explains in more detail the PRA’s approach to subsidiaries and EEA branches.
CRD IV: Commission Implementing Regulation (EU) No 945/2014 laying down ITS with regard to relevant appropriately diversified indices according to CRR published in the O.J. of the EU
05 Sep 2014
Commission Implementing Regulation (EU) No 945/2014 of 4 September 2014 laying down implementing technical standards with regard to relevant appropriately diversified indices according to Regulation (EU) No 575/2013 of the European Parliament and of the Council has been published in the Official Journal of EU.
It shall enter into force on 25 September 2014.
04 Sep 2014
The ECB published the final list of the 120 significant credit institutions, whose direct supervision it will assume on 4 November. The ECB will directly supervise credit institutions, financial holding companies or mixed financial holding companies that are deemed significant at the highest level of consolidation within participating Member States. The significant credit institutions account for almost 85 per cent of total banking assets in the euro area.
03 Sep 2014
The BCBS published an updated version of its frequently asked questions on Basel III monitoring. The document provides answers to technical and interpretive questions raised by supervisors and banks during the Committee’s Basel III monitoring.
03 Sep 2014
ESMA added LME Clear Ltd to its list of registered CCPs under the European Markets Infrastructure Regualtion (EMIR). EMIR requires EU-based CCPs to be registered and non-EU CCPs to be recognised in the European Union (EU)Rì.
03 Sep 2014
The Joint Forum released its report on supervisory colleges for financial conglomerates. The report, the result of a recent self-assessment survey of Joint Forum members, presents findings on how far cross-sectoral issues, and specific questions related to financial conglomerates, are effectively addressed within supervisory colleges.
The SEC adopts revisions to rules governing the disclosure, reporting, and offering process for asset-backed securities (ABS)
27 Aug 2014
The Securities and Exchange Commission adopted revisions to rules governing the disclosure, reporting, and offering process for asset-backed securities (ABS) to enhance transparency, better protect investors, and facilitate capital formation in the securitization market.
The new rules, among other things, require loan-level disclosure for certain assets, such as residential and commercial mortgages and automobile loans. The rules also provide more time for investors to review and consider a securitization offering, revise the eligibility criteria for using an expedited offering process known as “shelf offerings,” and make important revisions to reporting requirements.
News & articles
The SEC adopts new requirements for credit rating agencies to enhance governance, protect against conflicts of interest, and increase transparency to improve the quality of credit ratings and increase credit rating agency accountability
27 Aug 2014
The Securities and Exchange Commission adopted new requirements for credit rating agencies to enhance governance, protect against conflicts of interest, and increase transparency to improve the quality of credit ratings and increase credit rating agency accountability. The new rules and amendments, which implement 14 rulemaking requirements under the Dodd-Frank Act, apply to credit rating agencies registered with the Commission as nationally recognized statistical rating organizations (NRSROs).
01 Sep 2014
The PRA published supervisory statement on subordinated guarantees and the quality of capital. This supervisory statement applies to all insurers (firms) authorised by the Prudential Regulation Authority (PRA) and may also be relevant to insurance holding companies and other entities in the same group, together with their advisors. The statement also looks ahead to Solvency II (SII), and is aimed at firms and groups within the scope of the SII Directive. It is equally relevant for life insurers, general insurers and mutuals.
01 Sep 2014
The PRA published supervisory statement on valuation risk for insurers. It sets out the PRA’s expectations of firms in relation to existing rules on the valuation of financial assets. This statement applies to all PRA authorised insurers (firms) and may also be relevant to insurance holding companies and other entities in the same group, together with their advisors.
18 Aug 2014
The EBA published a new XBRL taxonomy to be used by competent authorities for remittance of data under the EBA Implementing Technical Standards on supervisory reporting. The new taxonomy will have as reference date 31 December 2014 onwards and will be used for the first reports on asset encumbrance and funding plans. The new taxonomy presents the data items, business concepts, relations, visualisations and validation rules described by the EBA Data Point Model which are contained in the ITS on supervisory reporting and in the EBA Guidelines on definitions and templates on funding plans.
Directive 2014/91/EU amending Directive 2009/65/EC on the coordination of laws, regulations and administrative provisions relating to UCITS as regards depositary functions, remuneration policies and sanctions published in the Official Journal of the EU
28 Aug 2014
Directive 2014/91/EU amending Directive 2009/65/EC on the coordination of laws, regulations and administrative provisions relating to undertakings for collective investment in transferable securities as regards depositary functions, remuneration policies and sanctions has been published in the Official Journal of the EU.
This Directive shall enter into force on 17 September 2014. Member States shall adopt and publish, by 18 March 2016 the laws, regulations and administrative provisions necessary to comply with this Directive.
20 Aug 2014
The EBA published the final templates for the 2014 EU-wide stress test. These are common templates for all EU banks and illustrate the type and the format of data that will be disclosed on a bank by bank basis. In its role of coordinator of the stress test, the EBA will be publishing up to 12,000 data points per bank across the entire EU, acting as the single hub for all information related to stress test outcomes of EU banks, as determined by competent authorities.
The ECB identifies four key payment systems that are now under the new ECB Regulation on oversight requirements for systemically important payment systems (SIPS)
21 Aug 2014
The ECB identified four key payment systems that are now under the new ECB Regulation on oversight requirements for systemically important payment systems (SIPS), which entered into force on 12 August 2014. The regulation covers large-value and retail payment systems in the euro area operated by both central banks and private entities, and aims at ensuring efficient management of legal, credit, liquidity, operational, general business, custody, investment and other risks as well as sound governance arrangements, namely with a view towards promoting the smooth operation of safe and efficient payment systems in the euro area.
- Last Update: Tuesday 16 September 2014, 11:07.