RegWatch newsletter August 2019 - Reacfin · DGSD [Go to top] 08/08/2019 The EBA publishes the first of three opinions on the implementation of the Deposit Guarantees Schemes Directive

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RegWatch newsletter – August 2019 Contact the authors: Elena Atienza ([email protected]), Antoine Gustin ([email protected])

This month’s News

Go to [CRR/CRD] [DGSD] [BMR] [PRIIPs] [IFRS] [Others] [ Acronyms List]

CRR/CRD [Go to top]

02/08/2019 Following the recent publication of the CRD5 / CRR2 / BRRD2 in the Official Journal of the

EU, the EBA has updated its Single Rulebook Q&A tool to reflect the new legislations.

See the Single Rulebook Q&A on EBA's website

05/08/2019 The EBA publishes its advice on the implementation of Basel III in the EU. The main

conclusions follow those already published in draft intermediate reports and are as follows:

MRC will increase by 24.4% on average, creating a capital shortfall of EUR 135.1 bn;

Most of the shortfall is supported by large, globally active banks;

Medium-size banks will see their MRC increase by 11.3% on average;

Small-sized banks will see their MRC increase by 5.5% on average.

See EBA's article on the report's publication and its main conclusions, and the official EBA

advice on Basel III implementation in the EU

09/08/2019 The EBA updates 12 indicators and underlying data relating to the 36 largest institutions in

the EU, in line with ITS and Guidelines on the identification of G-SIIs. The EBA will update

this data on a yearly basis.

See the EBA's article on the update of G-SII indicators

DGSD [Go to top]

08/08/2019 The EBA publishes the first of three opinions on the implementation of the Deposit

Guarantees Schemes Directive (DGSD). Changes on various aspects of the regulation are

proposed, not including, however, the current coverage level of EUR 100,000.

See EBA's first opinion on DGSD implementation

mailto:[email protected]



https://eba.europa.eu/single-rule-book-qa

https://eba.europa.eu/-/eba-advises-the-european-commission-on-the-implementation-of-the-final-basel-iii-framework

https://eba.europa.eu/documents/10180/2886865/Basel+III+reforms+-+Impact+study+and+key+reccomendations.pdf

https://eba.europa.eu/documents/10180/2886865/Basel+III+reforms+-+Impact+study+and+key+reccomendations.pdf

https://eba.europa.eu/-/the-eba-updates-data-used-for-the-identification-of-global-systemically-important-institutions-g-sii-2

https://eba.europa.eu/documents/10180/2622242/EBA+Opinion+on+the+eligibility+of+deposits+coverage+level+and+cooperation+between+DGSs.pdf

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BMR [Go to top]

19/08/2019 The ECB working group on euro risk-free rates publishes a report on the impact that the

transition from the current EONIA to the ECB’s euro short-term rate (€STR) will have on

cash and derivatives products.

See the ECB report on the transition from EONIA to Euro STR and its impact

PRIIPs [Go to top]

07/08/2019 ESAs respond to the European Commission on the exclusion of performance scenarios

options from PRIIPs consumer testing exercise.

See EIOPA's press release on the ESAs' answer to the EC following the exclusions

IFRS [Go to top]

15/08/2019 The IASB adds the second phase of its IBOR reform to its work plan. Phase 2 focuses “on

potential issues that might affect financial reporting once the existing rate is replaced with

an alternative rate.”

See the IASB's press release on the start of IBOR reform phase two


https://www.ecb.europa.eu/pub/pdf/other/ecb.wgeurorfr_impacttransitioneoniaeurostrcashderivativesproducts~d917dffb84.en.pdf?d9e4bc436bb2d9535d3743f107be7cfd

https://eiopa.europa.eu/Pages/News/ESAs-respond-to-the-European-Commission-on-the-exclusion-of-performance-scenarios-options-from-PRIIPs-consumer-testing-exer.aspx

https://www.ifrs.org/news-and-events/2019/08/iasb-adds-phase-two-of-its-project-on-ibor-to-the-work-plan/

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Others [Go to top]

07/08/2019 The ECB publishes an article on risks and monitoring issues raised by the crypto-assets

phenomenon.

See the ECB's article on risks and monitoring issues associated to crypto-assets

14/08/2019 The ECB calls on European banks to speed up the completion and implementation of their

no-deal Brexit plans, warning that many related targets have not yet been reached. “Some

banks in the euro area still need to continue adjusting their business and booking models in

line with their commitments. This includes significantly adjusting the practice of back-

branching, […] even when there is no local business need for them to do so. In addition,

certain banks have yet to align their remote booking practices and back‑to‑back hedging

strategies with supervisory expectations.”

See the ECB's article on the stepping-up of Brexit preparations

22/08/2019 The ECB publishes a communication on supervisory expectations for NPEs. Among others,

the communication provides further details on supervisory expectations for the

provisioning of NPE stock, and on interactions between Pillar 1 (coverage expectations) and

2 (prudential rules) approaches. The ECB further states that “it of the utmost importance

that the level of NPLs is further reduced in a swift manner while economic conditions are

still favourable. A failure to do so before moving into the next downturn, would pose a real

problem.”

See Norton Rose Fulbright's article on ECB communication about NPL supervision, and the

ECB communication on NPE supervisory expectations


https://www.ecb.europa.eu/pub/economic-bulletin/articles/2019/html/ecb.ebart201905_03~c83aeaa44c.en.html#toc16

https://www.bankingsupervision.europa.eu/press/publications/newsletter/2019/html/ssm.nl190814.en.html

https://www.regulationtomorrow.com/eu/ecb-communication-on-supervisory-coverage-expectations-for-npes/

https://eba.europa.eu/-/eu-banks-funding-plans-indicate-increased-appetite-for-market-based-funding-in-the-coming-years

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List of acronyms used in this issue [Go to top]

BMR benchmark regulation

BRRD Directive 2014/59/EU (Bank Recovery and Resolution Directive)

CRD Directive 2013/36/EU (Capital Requirements Directive)

CRR Regulation (EU) No 2013/575 (Capital Requirements Regulation)

DGS deposit guarantee scheme

EBA European Banking Authority

ESAs European Supervisory Authorities

EU European Union

G-SII globally systemically important institution

IASB International Accounting Standards Board

IBOR interbank offered rate

IFR Investment Firms Regulation

IFRS International Financial Reporting Standard

ITS implementing technical standards

NPE non-performing exposure

NPL non-performing loan

SII systemically important institution

PRIIP Packaged Retail and Insurance-based Investment Products


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Documents

RegWatch newsletter August 2019 - Reacfin · DGSD [Go to top] 08/08/2019 The EBA publishes the first of three opinions on the implementation of the Deposit Guarantees Schemes Directive