On 1 July 2014, the EBA published a report on the covered bonds framework throughout the EU and an opinion on the preferential capital treatment of covered bonds. The report is a comprehensive overview of the national regulatory and supervisory regimes of EU member states for covered bonds, providing key features, practices and advice on the conditions justifying preferential risk weight treatment for certain covered bonds. The report also includes advice to the European Commission, requested under the CRR, to inform the Commission’s report to the European Parliament and Council on whether the current capital treatment of covered bonds is suitable. The opinion covers recommendations on the risk weight preferential treatment of covered bonds, additional criteria for qualifying for preferential treatment and the appropriateness of including specific asset classes.

The report and opinion are available at: http://www.eba.europa.eu/-/eba-supports- capital-treatment-of-covered-bonds-but-calls-for-additional-eligibility-criteria.

On 30 June 2014, the European Systemic Risk Board (the “ESRB”) published a recommendation, dated 18 June 2014, addressed to EU national regulators on setting countercyclical buffer rates. The guidance is required under the CRD.  The ESRB also published its paper that informed the recommendation, called ‘Operationalising the countercyclical capital buffer: indicator selection, threshold identification and calibration options’. The recommended measures must apply from the date by which each member state requires banks in its jurisdiction to maintain institution-specific countercyclical capital buffers.

The Recommendation is available at: http://www.esrb.europa.eu/news/pr/2014/html/pr140630.en.html.