EBA amends ITS on supervisory reporting for institutions. The European Banking Authority issued final draft Implementing Technical Standards amending the European Commission’s Implementing Regulation on supervisory reporting to conform with disclosure requirements for capital buffers as well as to make minor technical corrections. (3/8/2016) EBA press release.
EBA updates XBRL taxonomies for remittance of data for supervisory reporting. The EBA released two updates to the XBRL taxonomy for use by competent authorities for remitting data under the EBA’s ITS on supervisory reporting. The EBA issued a corrective update to XBRL taxonomy 2.4, which will be used to for reports relating to the revised Liquidity Coverage Ratio and Leverage Ratio requirements. The EBA also published a new Data Point Model and revised XBRL taxonomy 2.5, which will be used for reports with reference dates as of December 31, 2016. (3/8/2016)
UK regulators mark beginning of accountability regimes for banking and insurance sectors. The Senior Managers Regime for the banking sector and the Senior Insurance Managers Regime became effective on March 7, 2016. The UK Financial Conduct Authority announced that the regimes, which establish standards of conduct for individuals working in regulated firms and hold senior managers accountable for misconduct that occurs within their areas of responsibility, will also apply to senior staff members of the FCA and the Prudential Regulation Authority. (3/7/2016) FCA press release.
FCA, BOE review effectiveness of MOU in 2015. The FCA and the Bank of England released the results of their 2015 review of the operation of their Memorandum of Understanding regarding the supervision of markets and market infrastructure. The review found that the operation of the MOU remained effective and did not result in significant instances of duplication. (3/4/3016) FCA press release.
FCA guidance on ring-fencing transfer schemes. The FCA published finalized guidance regarding its approach to the implementation of ring-fencing in the UK and ring-fencing transfer schemes. The finalized guidance specifies the requirements for appointing the skilled person to produce the scheme report for use in court proceedings pertaining to ring-fencing transfer schemes as well as the form and content of the scheme report. (3/4/3016) FCA press release.
PRA finalizes policy for ring-fencing transfer schemes. The PRA published a policy statement that responds to the feedback it received to its consultation regarding the implementation of ring-fencing and its approach to ring-fencing transfer schemes. The PRA also published a statement of policy that finalizes the application process for ring-fencing transfer schemes. (3/4/2016) PRA press release.
PRA proposes risk-based levies for FSCS deposits. The PRA requested comments on a consultation paper that proposes changes to the calculation of firm contributions to the Financial Services Compensation Scheme by requiring the FSCS to adjust compensation cost levies according to the degree of risk incurred by a Deposit Guarantee Schemes member and sets out the PRA’s methodology for calculating the degree of risk. Comments are due on or before June 3, 2016. (3/4/2016) PRA press release.
BOE annual report on financial market infrastructure supervision. The BOE published its annual report regarding the supervision of financial market infrastructures, which explains how the BOE exercised its responsibilities for supervision specifically in relation to cyber resilience, mitigation of financial risks, and improved effectiveness of the governance of financial market infrastructures. (3/4/2016) BOE press release.
FCA identifies problems with treatment of closed-book customers in life insurance sector. The FCA published the findings of its thematic review of the treatment of long-standing customers in life insurance, which identified concerns about the fair treatment of these customers especially regarding the communication of the impact of exit and paid-up charges. The FCA also requested comment on proposed non-Handbook guidance that explains the FCA’s expectations regarding firms’ approach to the treatment of closed-book customers. Comments are due on or before June 3, 2016. (3/4/2016) FCA press release.
EBA consults on reporting of prudent valuation information. The EBA requested comments on a proposal that would revise the COREP reporting framework to require banking institutions to include information on prudent valuation as well as additional information regarding credit risk. Comments are due on or before March 30, 2016. (3/4/2016) EBA press release.
FCA seeks comments on proposals relating to the Payment Accounts Regulations. The FCA published a consultation paper that seeks comments on proposed Handbook changes relating to the Payment Accounts Regulations 2015; proposed reporting requirements relating to switching and payment accounts with basic features; and proposed guidance concerning the definition of a payment account and the implementation of provisions on packaged accounts. Comments are due on or before May 3, 2016. (3/2/2016) FCA press release.
FCA makes final consequential changes to Senior Managers and Certification Regime. The FCA issued a policy statement that establishes the final rules relating to consequential and other technical amendments to the Senior Managers and Certification Regime, which reflect the elimination of the requirement that firms report known or suspected breaches of FCA conduct rules to the FCA. (3/2/2016) FCA press release.
PRA policy statement on conforming amendments to Senior Managers and Certification Regime. The PRA published a policy statement that contains the revised Conduct Rules: Notifications, which removes the requirement that firms notify the PRA if they know or suspect that an individual performing a senior management function failed to comply with PRA conduct rules, and amends the definition of “significant risk taker” to conform to the scope of the Senior Managers and Certifications Regime. (3/2/2016) PRA press release.
EBA releases results of CRDIV-CRR/Basel III monitoring exercise. The EBA published the results of its most recent CRDIV-CRR/Basel III monitoring exercise, which collected aggregate results on capital and liquidity ratios for EU banks as of June 30, 2015. (3/2/2016) EBA press release.
ESMA report on risks and costs associated with interoperability arrangements under EMIR. The European Securities and Market Authority released a report on systemic risk and cost implications resulting from interoperability arrangements between central clearing houses established under the European Market Infrastructure Regulation. (3/1/2016) ESMA press release.
EU adopts mandatory central clearing obligation for certain credit derivative contracts. The European Commission announced that it has adopted new rules that will require the mandatory clearing of certain over-the-counter credit derivatives contracts through central counterparties. The clearing obligation will apply to certain credit default swaps that are denominated in Euro covering some European corporates. (3/1/2016) EC press release.
EBA assessment of supervisors of cross-border banking groups. The EBA released its annual assessment of EU colleges of supervisors, which organize joint decisions on capital and liquidity and recovering plans for EU cross-border banking groups. (3/1/2016) EBA press release.
FCA launches outreach programs for firms to engage with regulators. The FCA will hold a series of events, workshops and roundtables across the UK that will allow investment, mortgage and general insurance firms to interact directly with regulators to provide them with better understanding of their regulatory obligations. The “Live & Local” programs began on March 1, 2016, and will take place during a four week period for each of 12 UK regions. (3/1/2016) FCA press release.
FCA and PRA break with EBA on application of bonus cap under CRD. The FCA and the PRA issued a joint statement in response to EBA Guidelines on Sound Remuneration Policies in which the regulators indicated they would not comply with the Guidelines’ approach to the bonus cap for firms subject to the Capital Requirements Directive, which applies a limit on awarding variable remuneration to 100 percent of fixed remuneration or 200 percent with shareholder approval for these firms. The FCA and the PRA stated that they would take a proportionate, risk-based approach to applying the bonus cap. (2/29/2016) Joint agency press release.
FCA highlights good practices for liquidity risk management. The FCA reported on the good practices of liquidity risk management and oversight that it observed during its assessment of investment management firms, including practices related to the disclosure of liquidity risks to investors; the management of redemptions and related transaction costs; and the implementation of liquidity tools and measures. (2/29/2016) FCA press release.
PRA finalizes conforming changes to Fees Part of Rulebook. The PRA published a policy statement containing the final rules and a supervisory statement that redrafts the FEES module of the Handbook to conform to the style of the PRA Rulebook. (2/26/2016) PRA press release.
PRA final rules on internal governance for third country branches. The PRA issued a policy statement that finalizes the rules concerning internal governance and organizational requirements for third country branches of non-European Economic Area banks and PRA-designated investment firms operating in the UK. The final rules include amendments related to the elements of the Senior Managers and Certification Regime affecting third country branches. The PRA published a supervisory statement alongside the final rules. (2/26/2016) PRA press release.
FCA responds to National Audit Office report on financial services mis-selling.The FCA released a statement in which it accepted the findings of a National Audit Office report which examined the FCA’s response, along with the responses of other financial regulators, to cases of financial mis-selling in an effort to assess their effectiveness, specifically relating to the imposition of penalties, the administration of redress schemes, and the regulatory responses of the agencies. (2/24/2016) FCA statement.