EBA Updates Single Rulebook Q&As

On October 17, the European Banking Authority (EBA) updated its Q&As on the single rulebook, publishing two new answers to questions relating to supervisory reporting and credit risk. The question IDs and topics for the new answers published are: (i) question ID: 2013_433: scope of application of FINREP; and (ii) question ID: 2013_374: definition of investments in private equity.

The Q&As relate to the CRD IV package of reforms: the CRD IV Directive (2013/36/EU) and the Capital Requirements Regulation (Regulation 575/2013) (CRR), and the related technical standards and guidelines developed by the EBA.  Q&As.

PRA Publishes Speech on Solvency II Models, Bonus Caps and Governance

On October 16, the Bank of England (BoE) published a speech given by Andrew Bailey, BoE Deputy Governor, Prudential Regulation and Chief Executive Officer, Prudential Regulation Authority, that considered, among other things, the use of models under the Solvency II Directive, the merits of the CRD IV Directive bonus caps for bankers and reforms to the governance of banks and insurers.  Speech.

ESMA Publishes Responses to Consultations on MAR

On October 17, the European Securities and Markets Authority (ESMA) published responses that it received to consultations published in July 2014 relating to the Market Abuse Regulation (Regulation 596/2014) (MAR) on: (i) draft technical advice on possible delegated acts concerning MAR; and (ii) draft regulatory technical standards (RTS) and implementing technical standards (ITS) on MAR.  Response.

IBA Publishes Position Paper on LIBOR

On October 20, ICE Benchmark Administration Limited (IBA) published a position paper on the evolution of the London Interbank Offered Rate (LIBOR) (also known as ICE LIBOR).

The paper sets out:  IBA’s findings since it became the administrator of LIBOR in February 2014; proposed enhancements following the Financial Stability Board’s publication on Reforming Major Interest Rate Benchmarks; and an invitation for views on the proposals from all stakeholders in LIBOR.  Position Paper.

ESMA Securities and Markets Stakeholder Group Responds to ESMA Consultations on Draft Technical Standards and Technical Advice on the Market Abuse Regulation

On October 13, the Securities and Markets Stakeholder Group (SMSG) of the European Securities and Markets Authority (ESMA)published its response to the July consultations published by ESMA on draft technical standards and draft regulatory standards (RTS),implementing technical standards (ITS) on the Market Abuse Regulation (Regulation 596/2014) (MAR) and draft technical advice on possible delegated acts concerning MAR.

SMSG has provided, in its response, advice to ESMA on the nine topics covered in the ESMA consultations including identifying key issues in respect of market soundings, insider lists, investment recommendations and manager transactions. The SMSG also sets out general comments on ESMA’s approach to building a single rulebook on market abuse.

The closing date for responses on the ESMA consultations was October 15.  SMSG Response.

IOSCO and CPMI Report on Recovery of Financial Market Infrastructures

On October 15, following a consultation launched in August 2013, the International Organization of Securities Commission (IOSCO) and the Committee on Payments and Market Infrastructure (CPMI) issued a joint report on the recovery of financial market infrastructures (FMIs).

The report supplements the international standard for FMIs published by IOSCO and CPMI in April 2012 and contains guidance to FMIs on the means of developing plans to enable recovery from threats to viability and financial strength which could prevent them from providing critical services to their participants and the markets they serve.  The report also provides guidance to relevant authorities on carrying out their responsibilities in connection with the development and implementation of recovery plans.  Report.

ESMA Final Draft RTS for Central Clearing of Interest Rate Swaps under EMIR

On October 2, the European Securities and Markets Authority (ESMA) published a report containing final draft regulatory technical standards (RTS) for the central clearing of interest rate swaps (IRS) under EMIR. The four IRS classes that will be subject to central clearing are basis swaps, fixed-to-float swaps, forward rate agreements and overnight index swaps, each denominated in a range of currencies.  Report.

The EBA Publishes Updates on the Bank Recovery and Resolution Directive

On October 3, the European Banking Authority (EBA) published a consultation paper on draft regulatory technical standards (RTS), implementing technical standards (ITS) and guidelines relating to group financial support under the Bank Recovery and Resolution Directive (BRRD). Under the BRRD, a number of conditions must be satisfied to permit one group entity to provide financial support to another group entity that meets the conditions for early intervention under the BRRD. The EBA is required to produce draft RTS and guidelines specifying these conditions. The deadline for comments on the consultation is January 4, 2015.

On October 1, the EBA published a consultation paper on draft guidelines on the interrelationship between the sequence of write-down and conversion of liabilities when the bail-in power under the BRRD is used and the hierarchy of capital instruments in the Capital Requirements Regulation. The deadline for comments on the consultation is January 3, 2015. Consultation Paper. Consultation Paper.

ESMA Compliance Table Relating to MiFID Remuneration

On October 7, the European Securities and Markets Authority (ESMA) published a guidelines compliance table relating to its guidelines on remuneration policies and practices under the Markets in Financial Instruments Directive (MiFID).

The table lists the jurisdictions whose national competent authorities (NCAs) have informed ESMA whether they comply or intend to comply with the guidelines. The only jurisdiction in the table listed as not complying is Germany. There is a comment in the table that states that the German NCA (BaFin) does not entirely comply with the guidelines insofar as it excludes from their scope any remuneration agreed within the scope of application of collective agreements. Guidelines Compliance Table.

Q&As and FAQs Updated by the Basel Committee, the FCA, the European Commission and the European Banking Authority

On October 7, the Basel Committee on Banking Supervision issued frequently asked questions on the Basel III leverage ratio framework.

On October 6, the Financial Conduct Authority (FCA) published a Q&A paper for alternative investment fund managers (AIFM) on reporting transparency information to the FCA.

On October 3, the European Commission published a frequently asked questions paper on the Regulation on improving securities settlement and regulating central securities depositories (CSDR).

On October 3, the European Banking Authority updated its Q&As on the single rulebook, publishing 16 new answers to questions largely relating to supervisory reporting and credit risk. Basel FAQs. FCA Q&As. European Commission FAQs. EBA Q&As.