FSB publishes framework for securities financing haircuts: FSB has published its final report on its Regulatory Framework for Haircuts on Non-centrally Cleared Securities Financing Transactions. The framework:
- lays down the methodology for calculating the haircuts applicable on the collateral lenders receive in securities financing transactions; and
- introduces higher floors than originally proposed for non-centrally cleared transactions with non-banks, other than for those transactions secured against government bonds.
FSB is also proposing to extend haircut floors to securities financing transactions entered into between non-banks. It asks for comments on this proposal by 15 December. Alongside this framework and consultation FSB has published a document discussing procyclicality of haircuts. (Source: FSB Publishes Regulatory Framework for Haircuts on Non-centrally Cleared Securities Financing Transactions)
FSB publishes NBFI resolution guidance: FSB has reissued its guidance on key attributes of effective resolution regimes for financial institutions. The guidance now includes new annexes dealing with non-bank financial institutions (NBFIs). The annexes deal with:
- resolution of Financial Market Infrastructures (FMIs), including central counterparties (CCPs), and resolution of systemically important FMI participants;
- resolution of insurers;
- client asset protection in resolution; and
- information sharing for resolution purposes.
(Source: FSB Publishes NBFI Resolution Guidance)