EIOPA consults on equity index for equity capital charge ITS: EIOPA has published a consultation paper on the draft ITS relating to the equity index for the symmetric adjustment of the equity capital charge. The consultation paper addresses:

  • inputs for the calculation of equity index;
  • exhaustive set or subset of relevant markets;
  • type of indices to use: gross total return indices or non-total return indices;
  • calculation of the weights; and
  • normalisation of equity indices.

For each policy issue EIOPA has outlined the policy options it has already considered as well as the costs and benefits of each of these. The consultation closes on 2 March 2015. (Source: EIOPA Consults on Draft ITS Related to the Equity Index for the Equity Capital Charge)

EIOPA publishes Q3 2014 risk dashboard data: EIOPA has released the data for its risk dashboard from Q3 of 2014. EIOPA concludes from the data that:

  • market risks remain unchanged since the last review. Specifically, historically low interest rates have been left unchanged or, in some cases, lowered;
  • the overall outlook for macroeconomic risks appears to be worsening;
  • profitability challenges remain, due to low investment yields;
  • Solvency 1 figures are robust but the recent stress test found that 14% of companies would have a capital ratio below 100% if calculated on a Solvency 2 basis;
  • liquidity and funding risks are unchanged;
  • interlinkages/imbalances still create uncertainties; and
  • insurance risks are not a major concern and are currently mainly driven by low premium growth in some countries.

(Source: EIOPA Risk Dashboard December 2014)

EIOPA issues guidance on Solvency 2 reporting and disclosure: EIOPA has published a note which it hopes will help firms and other stakeholders to more easily navigate the many documents relating to Solvency 2 that are currently under consultation. It also seeks to highlight more recent changes made to the various documents by EIOPA. (Source: Navigating through Solvency 2 Reporting and Disclosure Package)

EIOPA consults on Solvency 2 equivalence: EIOPA is consulting on making an equivalence determination in respect of Bermuda, Japan and Switzerland for Solvency 2 purposes. The assessment takes into account several key elements of the relevant third country's regulation, including:

  • system of governance;
  • professional secrecy and the exchange of information;
  • effective risk management;
  • solvency; and
  • powers and responsibilities of supervisory authorities.

EIOPA had already advised the Commission on the equivalence of the Swiss and Bermudian regimes in respect of reinsurance supervision, group solvency calculation and group supervision, and the Japanese regime for reinsurance supervision. The current paper updates this advice. EIOPA asks for comments by 23 January 2015. (Source: EIOPA Consults on Solvency 2 Equivalence)