UK Prudential Regulation Authority developments. The UK’s Prudential Regulation Authority published: 

European Banking Authority developments. The European Banking Authority published:

  • Final draft Regulatory Technical Standards (RTS) on the definition of market risk, and its final draft RTS on Credit Valuation Adjustment risk (CVA risk). The latter is supplemented by an Opinion on CVA risk which further elaborates on the approach taken by the EBA in determining a proxy spread. (12/20/2013)
  • Final Guidelines on capital measures for FX lending to unhedged borrowers under the Supervisory Review and Evaluation Process. (12/20/2013)
  • Final draft Implementing Technical Standards (ITS) on the reporting of the hypothetical capital of a central counterparty (CCP). (12/19/2013) 
  • Draft RTS and ITS related to market risk. (12/17/2013) 
  • Draft RTS on securitization retention rules and related requirements, as well as final draft ITS on the convergence of supervisory practices related to the implementation of additional risk weights in the case of non-compliance with the retention rules. (12/17/2013) 
  • A public consultation on draft guidance to both originator institutions and competent authorities when assessing significant risk transfer for securitization transactions. Comments should be submitted by March 17, 2014. (12/17/2013) 
  • Final draft RTS and ITS on information exchange between home and host competent authorities regarding branches and service providers. (12/16/2013)
  • Final draft ITS on joint decisions on institution-specific prudential requirements. (12/13/2013)
  • Final draft RTS on own funds ’Part three,’ which set out criteria to deduct indirect and synthetic holdings, to define broad market indices and to calculate minority interest. (12/13/2013) 
  • Final draft RTS and ITS on passport notifications. These RTS and ITS aim to specify the information that needs to be notified to competent authorities, as well as forms, templates and procedures underlying the submission of passport notifications. (12/13/2013) 
  • Final draft RTS on criteria to identify categories of staff whose professional activities have a material impact on an institution’s risk profile. These identified staff will be subject to provisions related, in particular, to the payment of variable remuneration
  • A public consultation on the methodology for identifying Global Systemically Important Institutions. Comments should be submitted by February 28, 2014. (12/12/2013)

ESMA report on proposed MiFID standards. The European Securities and Markets Authority published a final report on proposed technical standards under Article 10a(8) of the Markets in Financial Instruments Directive. The report presents the European Commission with proposals on the information companies should provide their competent authorities when seeking to acquire another firm. (1/7/2014) ESMA notice.

EU proprietary trading proposal. Reuters summarized a European Union proposal that would impose restrictions on the proprietary trading activities of banks. The proposal is not as strict as the US “Volcker rule,” which prohibits deposit-taking banks from engaging in proprietary trading. The EU contains a narrow definition of what constitutes proprietary trading and would apply only to the largest EU banks. (1/6/2014) Proprietary trading. 

EU members approve criminal sanctions for market abuse. The European Commission, European Parliament and the Council of Ministers reached agreement on the EC’s proposal for a Directive on criminal sanctions for market abuse. Among other things, the agreement defines insider dealing, unlawful disclosure of information and market manipulation; sets forth a common set of criminal sanctions; and makes companies potentially liable for market abuses. (12/20/2013) EC press release. 

ESMA proposes revisions to collateral requirements. The European Securities and Markets Authority published a consultation paper on proposed revisions to its provisions on diversification of collateral for ETFs and other UCITS issues. Comments should be submitted by January 31, 2014. (12/20/2013) ESMA notice. 

ESMA guidance on exchange-traded derivatives reporting. The European Securities and Markets Authority issued updated guidance in the form of Question & Answers on the implementation of the European Markets Infrastructure Regulation. The guidance clarifies how exchange-traded derivatives should be reported to trade repositories. (12/20/2013) ESMA notice. 

ESMA guidance on CRA Regulation. The European Securities and Markets Authority published updated guidance on the application of the CRA Regulation and in particular, the CRA 3 Regulation (Regulation (EU) No 462/2013). The guidance is in the form of answers to questions posed by credit rating agencies and market participants regarding the practical application of the CRA Regulation. (12/17/2013) ESMA notice. 

UK FCA mortgage market data collection. The UK Financial Conduct Authority issued a policy statement and final rules on data it collects from the mortgage market. The rules are effective January 1, 2015. (12/16/2013) FCA press release. 

UK listing rules. The UK Financial Conduct Authority published final rules amending the Listing Rules. The new rules are intended to reduce unnecessary administrative burdens for a premium listed company incorporated in the UK. (12/13/2013) FCA press release. 

UK Capital Requirements Directive changes. The UK Financial Conduct Authority published a Policy Statement on the changes it is making in accordance with the Capital Requirements Directive (CRD). CRD IV, consisting of Directive 2013/36/EU and Regulation (EU) 575/2013, is the EU implementation of Basel III for banks, and also applies to investment firms. (12/13/2013) FCA press release.