EU adopts variable remuneration rules. The European Commission adopted Regulatory Technical Standards on criteria to identify categories of staff whose professional activities have a material impact on a financial institution’s risk profile. These “risk takers” will be subject to EU rules on variable remuneration (including bonuses). (3/4/2014) EU press release. Bloomberg summarized the standards, noting their more controversial provisions. (3/4/2014) Summary.
UK FCA reviews retail sales incentives. The UK Financial Conduct Authority published the results of its most recent review of sales incentives used by retail financial services firms. The FCA found significant improvements at many firms of all sizes but identified a number of areas common across the industry where further work was needed. (3/4/2014) FCA press release.
UK PRA occasional consultation paper. The UK Prudential Regulation Authority proposed miscellaneous and minor amendments to its rules and guidance. The proposal concerns financial conglomerates’ capital adequacy, proposed amendment to the supervisory statement on the internal capital adequacy assessment process and the supervisory review and evaluation process, Shari’ah-compliant liquid assets and risk management of asset encumbrance. Comments should be submitted by April 15, 2014. (3/4/2014) PRA press release.
UK to consider tougher claw back rules. The Telegraph reported that the UK Prudential Regulation Authority will soon launch a consultation on new, stiffer compensation claw back rules for bank executives. (3/4/2014) Claw backs.
UK FCA reviews platform rules. As the April 6, 2014 deadline approaches for implementing the UK Financial Conduct Authority’s new rules for platforms, the FCA published a thematic review of how firms are preparing to meet that deadline. (3/3/2014) FCA press release.
Singular uncertainty. Bloomberg discussed the uncertainty surrounding provisions of the EU’s Single Resolution Mechanism. The banking industry, EU member states and the European Parliament cannot agree on how much banks should be required to contribute to the pool meant to support the orderly resolution of a failed bank. (3/2/2014) Uncertainty.
EBA draft technical standards for margin periods. The European Banking Authority launched a consultation on draft Regulatory Technical Standards aimed at specifying the minimum margin periods of risk that institutions acting as clearing members may use for the calculation of their capital requirements for exposures to clients. Comments should be submitted by May 9, 2014. EBA press release. (2/28/2014).
EBA publishes consumer trends report. The European Banking Authority published its annual report on consumer protection and financial innovation trends. The report identifies the consumer issues that may arise, or have arisen, and describes the approaches the EBA will be taking in 2014 to address those issues. EBA press release. (2/28/2014)
FCA consumer credit consultation. The UK Financial Conduct Authority opened a consultation on proposed amendments to the FCA Handbook that would prohibit or restrict European Economic Area authorized payment institutions and electronic money institutions from undertaking certain consumer credit business in the UK. Comments should be submitted by March 14, 2014. FCA press release. (2/28/2014)
FCA commodity markets update. The UK Financial Conduct Authority published a commodity markets update to explain how the FCA will respond to changes in the commodity derivative markets. Update. (2/27/2014)
Firm disclosure of non-financial information. The European Parliament and the European Council have reached agreement on an amendment to existing accounting legislation to improve the transparency of certain large companies on social, environmental and diversity matters. Under the agreement, companies will need to disclose information on their policies, risks and results regarding environmental matters, social and employee-related issues, respect for human rights, anti-corruption and bribery issues and diversity on boards of directors. (2/26/2014) EC press release.
ESMA report on credit rating agencies. The European Securities and Markets Authority published its 2013 annual report on credit rating agencies in the European Union. The report also outlines ESMA’s supervisory work plan for this year. (2/21/2014) ESMA notice.
European Parliament committee approves anti-money laundering rules. The European Parliament’s Economic and Monetary Affairs Committee approved new draft anti-money laundering rules previously approved by the Economic Affairs and the Justice and Home Affairs committees. Under the anti-money laundering directive, information on the ultimate beneficial owners of different legal arrangements, including companies, foundations and trusts would be listed and made publicly available. (2/20/2014) Econ Committee press release.
Euribor benchmark-setting improves. The European Securities and Markets Authority and the European Banking Authority published the results of their joint review of the Euribor-EBF. The review found that Euribor-EBF has made significant progress in implementing the ESMA-EBA recommendations for improved transparency of the benchmark-setting process, enhanced governance of the benchmark, and improved quality of the resulting index. (2/20/2014) ESMA notice.
EBA final draft standards on variable remuneration. The European Banking Authority published final draft Regulatory Technical Standards on classes of instruments that can be used for the purposes of variable remuneration. (2/19/2014) EBA press release.