Posts by: Harry Denlegh-Maxwell

Brexit: Supreme Court Ruling


The UK Supreme Court rules that the Government cannot trigger Article 50 without a vote in Parliament.

Following the June 2016 referendum, the UK Government proposed to use its prerogative powers to withdraw from the EU by serving a notice in accordance with Article 50 of the Treaty on European Union, withdrawing the UK from the EU treaties. To read the full article, please click here.

ESMA Publishes Technical Advice on MiFID II

The European Securities and Markets Authority (“ESMA“) published final technical advice on December 19 to the European Commission, and a consultation paper on the MiFID II Directive and the Markets in Financial Instruments Regulation (“MiFIR“).

The consultation paper includes draft regulatory technical standards and implementing standards under the MiFID II Directive and MiFIR. Consultation closes on March 2. The accompanying press release is found at the following link: press release.

EIOPA Updates Risk Dashboard

On December 18, the European Insurance and Occupational Pensions Authority (“EIOPA“) published an updated version of its risk dashboard (dated December 19), together with a background note (dated December 4).

EIOPA states that the risk environment facing the insurance sector remains challenging. Among others, the dashboard suggests that the overall outlooks for macroeconomic risks seems to be worsening, and that profitability challenges remain, due to low investment yields.

European Commission Guidance on Implementing Russian Sanctions

On December 18, the government published a European Commission notice (dated December 16) containing guidance on implementing certain provisions of EU Regulation 833/2014.

The notice explains that the Regulation relates to restrictive measures targeting sectorial co-operation and exchanges with the Russian Federation including, among other things, measures aimed at limiting access to EU capital markets for Russian State-owned financial institutions. The guidance is designed to help national authorities and other relevant parties (including EU financial institutions) to implement the Regulation in a uniform manner.

The guidance takes the form of answers to certain questions that have been brought to the Commission’s attention. In relation to the financial services measures, the Q&As cover trade finance, emergency funding, loans (other than for trade finance or emergency funding), and capital markets.

Council of EU Presidency Compromise on Regulation on ECB’s Powers to Impose Sanctions

On December 11, the Council of the EU published a note (dated December 10) that amends the ECB’s powers to impose sanctions.

The ECB published its recommendation for a Council Regulation in April 2014. The recommendation aims to establish a coherent regime for the imposition by the ECB for sanctions relating to the performance of its supervisory tasks under the Regulation establishing the single supervisory mechanism, by adapting the framework already set out for the purposes of monetary policy conduct.

BCBS Issues Revisions to Basel Securitization Framework

The Basel Committee on Banking Supervision (“BCBS“) issued revisions to the Basel II securitization framework on December 11.

 The framework, which comes into effect in January 2018, forms part of the BCBS’s broader Basel II agenda to reform regulatory standards for banks in response to the global financial crisis. The revisions aim to address a number of shortcomings in the securitization framework highlighted by the financial crisis and strengthen the capital standards for securitization exposures held in the banking book.

 The final requirements set out in the framework incorporate feedback to two rounds of consultation in 2012 and 2013 and take account of two quality impact studies undertaking during those consultations. Compared to the 2013 proposals, this final set of requirements includes amendments that smooth the impact of maturity on capital charges, as well as technical enhancements and clarifications.

EBA Publishes Risk Dashboard of EU Banking Sector for Q3 2014

On December 11, the European Banking Authority (“EBA“) published its risk dashboard for the third quarter of 2014, summarizing the main risks and vulnerabilities in the EU banking sector.

The data reflected in this version of the dashboard shows that, among other things:

  • Capital positions in EU banks reached the highest level since 2009, driven by capital issuances ahead of the stress test and assets quality review exercises;
  • Levels of non-performing loans remained stable, but were still high;
  • Profitability levels were volatile;
  • Shifting of balance sheet structure continued; and
  • Loan-to-deposit ration remained fairly unchanged during H1 2014.

 The EBA also published an interactive tool.

FSB Consults on Total Loss-Absorbing Capacity for G-SIBs

On November 10, the Financial Stability Board (FSB) published a consultation paper on proposals on the adequacy of total loss-absorbing capacity (TLAC) of global systemically important banks (G-SIBs) in resolution.

In the consultation, the FSB seeks views on principles on loss absorbing capacity of G-SIBs in resolution, covering issues such as the calibration of the amount of TLAC required, the determination of TLAC-eligible instruments and the consequences of breaches of the requirement.  The deadline for responses to the consultation is February 2, 2015.