FSB Releases Responses to Draft Consultation on Foreign Exchange Benchmarks
The Financial Stability Board released responses to its Consultative Document on Foreign Exchange Benchmarks. The consultative report was released on July 15, 2014 and comments were collected until August 12.
FSB Regional Consultative Group for the Americas Releases Reports on Risk Management Practices and Shadow Banking
The Financial Stability Board's Regional Consultative Group for the Americas released two reports, titled “Report on the Effect on Host Countries of Balance Sheet Consolidation and Risk Management Practices by Global Banks”, and “Report on Shadow Banking in the Americas. “
Risk Management Report | Risk Management Press Release
Shadow Banking Report | Shadow Banking Press Release
FSB Regional Consultative Group for Asia Releases Reports on SIFIs and Shadow Banking
The Financial Stability Board's Regional Consultative Group for Asia released two reports, titled “Report on the Impact of SIFI Framework on the Asia Region and Measures in Response”, and “Report on Shadow Banking in Asia.”
SIFI Report | SIFI Press Release
Shadow Banking Report | Shadow Banking Press Release
FSB Regional Consultative Group for Asia Holds Meeting
The Financial Stability Board's Regional Consultative Group for Asia held its seventh meeting in Kyoto, Japan to discuss, among other topics, building resilient financial institutions, ending too big to fail, transforming shadow banking and making derivatives markets safer. Members noted that authorities are taking steps to ensure proper and proportionate monitoring and oversight of shadow banking activities in the region and the risks shadow banking entities pose to the financial system
IMF Releases Working Paper on the Role of Macroprudential Policies in Mitigating Systemic Risk
The International Monetary Fund released a Working Paper entitled "Macro-Prudential Policies to Mitigate Financial System Vulnerabilities." The paper analyzes 2,800 banks in 48 countries over a 10-year period and concludes that measures aimed at borrowers such as caps on debt-to-income ratios, and measures aimed at financial institutions such as credit growth limits, are effective in reducing asset growth.
IMF Releases Working Paper on Macroprudential Policies
The International Monetary Fund released a Working Paper entitled "Capital Flows, Financial Intermediation and Macroprudential Policies," which assesses the role of macroprudential policies in Asia. The report finds that macroprudential measures can complement monetary policy, reduce macroeconomic volatility, and enhance welfare.
BIS Releases Working Paper on Infrastructure Finance and Investment
The Bank for International Settlements' Monetary and Economic Department released a working paper titled “Understanding the Challenges for Infrastructure Finance.” The report states that greater involvement of private investors and the design of economically rational financing structures can mitigate problems and improve the efficiency and success of infrastructure projects.
Working Paper | Press Release
Basel Committee Releases Technical Paper on The Standardized Approach for Measuring Counterparty Credit Risk Exposures
The Basel Committee on Banking Supervision published a working paper to explain the different modeling assumptions used in developing the standardized approach for measuring counterparty credit risk exposures (SA-CCR). The paper also clarifies certain aspects of the SA-CCR calibration that are not discussed in the final standard that was published in March 2014
EBA Releases Updated XBRL Taxonomy for Remittance of Supervisory Reporting
TheEuropean Banking Authority released an updated Data Point Model and XBRL Taxonomies for Implementing Technical Standard onSupervisory Reporting. The updated taxonomy presents data items, business concepts, relations, visualizations and validation rules describes by the EBA Data Point Model, and incorporates corrections to certain reporting structures to be more in line with recently published ITS amendments.
XBRL Taxonomy | Press Release
EBA Releases Final Templates for EU Bank Stress Tests
The European Banking Authority released the finaltransparency templates for the 2014 EU-Wide Stress Test. These will be the common templates for all EU banks, and illustrate the type and format of data that will be disclosed, and for the first time, the EBA will disclose a fully loaded CRR/CRD4 Common Equity Tier 1 capital ratio for each bank.
Templates | Press Release
EBA Releases Single Rulebook CRD 4 Q&As
The European Banking Authority (EBA) has published 26 new questions and answers (Q&As) on the single rulebook. The Q&As address questions on the amended Capital Requirements Directive and associated Regulation (CRD and CRR, together CRD 4), as well as questions relating to EBA guidelines.
Questions and Answers
ESMA Publishes Opinion on the Application of Guidelines on MMFs
The European Securities and Markets Authority (ESMA) issued an opinion on the application of guidelines issued by the Committee of European Securities Regulators (CESR), the predecessor of ESMA, in relation to European money market funds (MMFs). The opinion is aimed at competent authorities to ensure a common supervisory culture and consistent supervisory practices. The opinion focuses on application of the modifications to the CESR guidelines as set out in a report issued earlier this year by the Joint Committee of the three European Supervisory Authorities. This Joint Committee report set out the manner in which CESR guidelines were to be amended, in particular regarding the assessment of credit quality of money market instruments.
ESMA Issues Responses to EMIR Consultation on Clearing Obligation
The European Securities and Markets Authority (ESMA) issued a list of responses to its first consultation in respect of central clearing of over-the-counter derivatives within the EU. The consultation focused on stakeholders’ views on draft regulatory technical standards (RTS) for the clearing of interest rate swaps (IRS). The clearing obligation is to take effect following a phased implementation depending on the type of counterparty.
FCA Calls for Examples of Retrospective Application of Regulatory Rules
The FCA has asked firms to supply examples of when it (or the Financial Services Authority) applied its rules retrospectively i.e. where regulators applied a more demanding standard or interpretation of the rules with the benefit of hindsight. The objective of this project is to determine whether market development is being held back by uncertainty around rules or concerns over retrospection. The deadline for the sending in examples is 10 October 2014.
FCA Releases Draft Consultation on Transparency Directive Reporting Requirements
The Financial Conduct Authority released a consultation paper on early implementation of the transparency directive's requirements for reports on payments to governments. Comments are due by October 7, 2014.
Consultation Paper | Press Release
LEI Regulatory Oversight Committee Publishes Guidance of Interim Decision-Making
The regulatory oversight committee for LEI has now published further guidance setting out principles to guide interim decision-making until the Global Legal Entity Identifier Foundation (GLEIF) takes over operational governance of the system.
PRA Publishes Supervisory Statement on Valuation Risk for Insurers
The Bank of England’s Prudential Regulatory Authority (PRA) has published a supervisory statement on valuation risk for insurers (SS9/14), which follows its consultation. It sets out the PRA's expectations of firms relating to rules on the valuation of financial assets in the General Prudential sourcebook (GENPRU), focusing on Valuation uncertainty and prudent valuation and client-supplied prices.
Australian Prudential Regulation Authority Releases Framework for Supervising Conglomerates but Defers Implementation
APRA released its planned framework for the supervision of conglomerate groups, but final implementation will be deferred until the Financial System Inquiry’s recommendations have been announced. The planned framework has been designed to ensure that APRA supervision captures the risks to which regulated institutions within conglomerate groups are exposed and which are not adequately covered by existing prudential arrangements for stand-alone entities and single industry groups.
Monetary Authority of Singapore Releases Consultation Paper on Proposed Credit Bureau Regulatory Framework and Credit Bureau Bill
MAS proposed to enact a Credit Bureau Act ("CBA"), and this consultation paper outlines MAS’ supervisory powers under this proposed CBA, as well as the obligations of licenses credit bureaus. Comments on the outlines proposals are due by September 12, 2014.
Muhammad bin Ibrahim Speaks on Cyber Risk and Regulatory Expectations
Central Bank of Malaysia Deputy Governor Muhammad bin Ibrahim delivered a speech entitled "Demystifying Cyber Risks - Evolving Regulatory Expectations" at the SEACEN Cyber Security Summit 2014 in Kuala Lumpur, Malaysia. He warned that as financial institutions grow, the nature and extent of cyber risks will continue to expand, and urged the need to place cyber security issues as a priority in industry efforts to make the financial system safe and sound.