Posts by: Aoife Casey

International Role of the Euro

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On December 5, 2018, the Commission adopted a Communication and a Recommendation on a stronger international role of the euro, following President’s Juncker State of the Union address in September 2018, in which he highlighted the strategic importance of the euro.

Since then, the Commission has run a series of consultations and stakeholder dialogues to determine the potential obstacles to a broader use of the euro. The consultation activities targeted stakeholders in the sectors of foreign exchange markets, energy, raw materials, agricultural commodities and transport. READ MORE →

EMU: European Commission Publishes Reports on Progress

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The European Commission has recently published the following documents, accompanied by a series of press releases and fact sheets:

  • Communication, Deepening Europe’s Economic Monetary Union (EMU): Taking stock four years after the Five Presidents’ Report.
  • Staff Working Document, Strengthening the International Role of the Euro, Results of the Consultations.

Related to these documents, the Commission published a Communication, Fourth Progress Report on the reduction of non-performing loans (NPLs) and further risk reduction in the Banking Union.

ESMA Publishes Final Report on Frequent Batch Auctions for Equity Instruments Under MIFID II

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On June 11, the European Securities and Markets Authority (ESMA) published its final report (ESMA70-156-1035) following a call for evidence on frequent batch auctions, a type of periodic auction trading system for equity instruments under the MiFID II Directive (2014/65/EU) and the Markets in Financial Instruments Regulation (600/2014) (MiFIR). READ MORE →

European Commission Adopts Delegated Regulation Supplementing EuVECA Regulation

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On February 4, the European Commission adopted a Delegated Regulation supplementing the European Venture Capital Funds (“EuVECA“) Regulation (345/2013) with regard to conflicts of interest (C(2019) 664 final).

The Delegated Regulation specifies the types of conflicts of interest, referred to in Article 9 of the EuVECA Regulation, and the steps that managers of EuVECA funds need to take to identify, prevent, manage, monitor and disclose conflicts.

The Delegated Regulation will enter into force 20 days after its publication in the Official Journal of the EU. It will apply six months after its entry into force. The next step is for the Delegated Regulation to be considered by the European Parliament and Council of the EU. Delegated Regulation.

ECB Publishes Decision Revising Format of MIB and Repealing Decision Establishing T2S Board

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On February 4, the Decision (EU) 2019/166 of the European Central Bank (“ECB“) on the Market Infrastructure Board (“MIB“) and repealing Decision ECB/2012/6 on the establishment of the TARGET2-Securities (“T2S“) Board (ECB/2019/3) was published in the Official Journal of the EU (“OJ“). READ MORE →

EBA Releases Results of 2018 EU-Wide Stress Test

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A report was recently published by the European Banking Authority (“EBA“) setting out the results of its 2018 EU-wide banking stress test which covered a sample of 48 banks in 15 countries in the EU and the EEA at the highest level of consolidation, representing about 70% of total EU banks’ total assets.

An overview of the key aggregate results and a description of the main drivers of the capital impact is provided by the report. Annex II includes a bank-by-bank summary of the results, while banks’ individual results are accessible on the EBA’s website. READ MORE →

European Commission Letter to ESMA on Share Cancellation Under MMF Regulation

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On July 20, the European Securities and Markets Authority (“ESMA“) published a letter it has written to the European Commission about share cancellation under the Regulation on money market funds ((EU) 2017/1131) (“MMF Regulation“).

The letter responds to a January 2018 letter from the Commission in which it agreed with ESMA’s analysis that the practice of share cancellation is not compatible with the MMF Regulation.

ESMA calls on the Commission to make public the text of an opinion of the Legal Service of the Commission on the compatibility of the reverse distribution mechanism or share cancellation with the MMF Regulation. It appears the opinion has been shared with some market participants, but not all. ESMA is of the view that the Commission needs to make its interpretation clear to ensure a proper and consistent interpretation and implementation of the MMF Regulation.

The MMF Regulation started to apply from July 21, 2018.

EBA Final Report on Guidelines on Management of Non-Performing and Forborne Exposures

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On October 31, the European Banking Authority (“EBA“) published its final report on guidelines on the management of non-performing and forborne exposures (EBA/GL/2018/06).

The guidelines seek to reduce non-performing exposures (“NPEs“) on banks’ balance sheets. The EBA expects credit institutions with a gross non-performing loan (“NPL“) ratio at 5% or above to establish NPE strategies and to introduce governance and operational requirements to support those strategies. The NPE strategy should set out the credit institution’s approach and objectives regarding effective management to maximize recoveries and ultimately a reduction in NPE stocks in a clear, credible and feasible manner for each relevant portfolio. READ MORE →