18 August - 29 August 2014

Regulatory and Legislative Developments from Across the Globe

 

The next edition of GFMA Weekly will be published on September 12. Our standard weekly publication on Fridays will resume thereafter.

World View

FSB Releases Responses to Draft Consultation on Foreign Exchange BenchmarksIMF Logo
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.
Responses

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
Press Release

IMF LogoIMF 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.
Working Paper

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.
Working Paper

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
Working Paper

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.
Opinion

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.
Responses

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.
Press Release

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.
Guidance

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.
Supervisory Statement

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.
Press Release

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.
Consultation Paper

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.
Speech

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GFMA & GFMA - Affiliate News & Events

Program Available: SIFMA FATCA Policy Symposium 2014 – Oct 6-7, Washington DC
SIFMA will host leading industry experts – including keynote speaker Simon Potter, Head of the Markets Group, Federal Reserve Bank of New York – to share perspectives on the SFT market and regulatory landscape. This half-day conference will discuss the state of the market before the financial crisis; actions taken by the industry and regulators to enhance the resiliency of the repo, sec lending and prime brokerage markets; and the future direction of the industry. Topics to be covered include: Tri-Party Repos, Shadow Banking and Capital Ratios.
Register now - Early bird registration ends Saturday, September 6th.

Program Available: Securities Financing Transactions Conference – Oct 7, NYC
SIFMA will host leading industry experts – including keynote speaker Simon Potter, Head of the Markets Group, Federal Reserve Bank of New York – to share perspectives on the SFT market and regulatory landscape. This half-day conference will discuss the state of the market before the financial crisis; actions taken by the industry and regulators to enhance the resiliency of the repo, sec lending and prime brokerage markets; and the future direction of the industry. Topics to be covered include: Tri-Party Repos, Shadow Banking and Capital Ratios.
Register Today!

SIFMA Annual Meeting: Program Sneak Peeks – Nov. 10, NYC
SIFMA's 2014 Annual Meeting once again gathers the leaders of the financial services industry together with prominent policymakers and financial media. Join us to explore the role of capitalism in creating opportunity across America. In one-on-one conversations and on in-depth panels, today’s foremost thought leaders – including former Mayor of the City of New York and Founder of Bloomberg LP, Michael Bloomberg, and Co-Founder and Co-CEO of the Carlyle Group, David Rubenstein, and Stephen Luparello, the new Director of Trading and Markets for the Securities and Exchange Commission – will share their perspectives on how the financial services industry will best serve tomorrow's economy.
Register Today

Register Today for Early Bird Rates: 2015 AML & Financial Crimes Conference: Feb. 24-25, NYC
Join us at SIFMA’s 15th Annual Anti-Money Laundering and Financial Crimes Conference on at the Marriott Marquis in New York City. This event brings together leading experts from the industry, regulatory agencies and law enforcement to discuss new trends in financial crime; emerging issues relating to anti-money laundering, economic sanctions and anti-bribery/anti-corruption compliance; and changes in regulatory expectations and requirements.  Now in its 15th year, this is the only conference in the AML space tailored to broker-dealers and other members of the securities industry.
Register now for Early Bird rates.

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