EIOPA published the updated risk dashboard, which is based on the Solvency II data for the fourth quarter of 2018 and summarizes key risks and vulnerabilities in the insurance sector in EU. The data used are based on financial stability and prudential reporting from 96 insurance groups and 2,873 solo insurance undertakings. Overall, the results show that risk exposures of the insurance sector in EU remain stable.
The data show that credit and market risks remain at medium level amid slightly decreased bond spreads, stable portfolio exposures, and broadly unchanged bond volatility. Profitability and solvency risks are stable, with overall profitability indicators unchanged, compared to the second half of 2018 and the end of 2017. Median Solvency Capital Requirement (SCR) ratios are well above 100% for groups, life, and non-life solo undertakings. Market perceptions remain stable at a medium level, with the insurance stocks slightly outperforming the overall market, a reduction in insurance groups' Credit Default Swap spreads, and the unchanged external ratings.
Keywords: Europe, EU, Insurance, Risk Dashboard, Solvency II, SCR, Credit Risk, Market Risk, EIOPA
Previous ArticleFIN-FSA Publishes Regulations and Guidelines Related to CRR
PRA published the policy statement PS8/21, which contains the final supervisory statement SS3/21 on the PRA approach to supervision of the new and growing non-systemic banks in UK.
EBA published a report that sets out the final draft regulatory technical standards specifying the conditions according to which consolidation shall be carried out in line with Article 18 of the Capital Requirements Regulation (CRR).
EBA updated the list of other systemically important institutions (O-SIIs) in EU.
BCBS published two reports that discuss transmission channels of climate-related risks to the banking system and the measurement methodologies of climate-related financial risks.
UK Authorities (FCA and PRA) welcomed the findings of FSB peer review on the implementation of financial sector remuneration reforms in the UK.
PRA and FCA jointly issued a letter that highlights risks associated with the increasing volumes of deposits that are placed with banks and building societies via deposit aggregators and how to mitigate these risks.
MFSA announced that amendments to the Banking Act, Subsidiary Legislation, and Banking Rules will be issued in the coming months, to transpose the Capital Requirements Directive (CRD5) into the national regulatory framework.
EC finalized the Delegated Regulation 2021/598 that supplements the Capital Requirements Regulation (CRR or 575/2013) and lays out the regulatory technical standards for assigning risk-weights to specialized lending exposures.
OSFI launched a consultation to explore ways to enhance the OSFI assurance over capital, leverage, and liquidity returns for banks and insurers, given the increasing complexity arising from the evolving regulatory reporting framework due to IFRS 17 (Insurance Contracts) standard and Basel III reforms.
ECB published results of the benchmarking analysis of the recovery plan cycle for 2019.