EBA updates on correlated currencies: EBA has updated its December 2013 list of closely correlated currencies for the purposes of calculating the capital requirements for foreign exchange (FX) risk according to the standardised rules. (Source: EBA Updates List of Closely Correlated Currencies)

EBA publishes resolution guidelines: EBA has published three sets of final guidelines which aim to facilitate the implementation of resolution tools in the banking industry. There are sets of guidelines for:

  • the "sale of business tool": these guidelines outline the elements that national authorities should assess when determining whether they may deviate from the standard marketing requirements for the sale of the business of an institution under resolution on the grounds that the failure of the institution represents a material threat to financial stability and there is a conflict between the effectiveness of the tool and the marketing requirements;
  • the "asset separation tool": these guidelines outline the three steps involved in analysing assets for the purposes of transferring them under the "asset separation tool" to an asset management vehicle ("bad bank"); and
  • "necessary services": these guidelines define a minimum list of necessary "critical' services that Resolution Authorities may require from institutions under resolution.

These guidelines all stem from the Bank Resolution and Recovery Directive (BRRD) and are designed to encourage convergence on resolution matters by giving detailed guidance to Resolution Authorities regarding the circumstances they should assess before making any resolution decisions. (Source: EBA Issues Guidance on the Implementation of Resolution Tools)