Featured Product

    ESRB Report Examines Macro-Prudential Measures Adopted in EU in 2018

    April 30, 2019

    ESRB published a report that provides an overview of the macro-prudential measures that were adopted in EU in 2018. Across EU, most member states adopted macro-prudential measures in 2018 and more measures were taken in 2018 than in 2017, which is the previous review period.

    The report describes the changes in policy frameworks and outlines the national macro-prudential measures that were adopted in 2018. It first reviews certain trends seen across different instruments and then turns to specific instruments. The report also contains three special features. Special Feature A considers the use to date of national flexibility measures under Article 458 of the Capital Requirements Regulation (CRR) by member states, along with the lessons learned from their experience with these measures. Special Feature B introduces the concept of macro-prudential stance, particularly the interlinkages between the stance assessment and the policy action assessment. Special Feature C provides an overview of the upcoming changes to macro-prudential provisions in CRR and the Capital Requirements Directive (CRD) IV. 

    Apart from the activation of the countercyclical capital buffer (CCyB) and the increase in the CCyB rate in several European Economic Area member states, nine member states introduced a systemic risk buffer (SyRB) or recalibrated the SyRB rate. As there are indications that the financial cycle is turning in some countries, more member states tightened the CCyB. By the end of 2018, twelve countries in the European Economic Area had decided on a positive CCyB rate. Despite extensive international and European guidance for the use of CCyB, differences in key features of the national frameworks remained. These include the objective of the instrument, the neutral buffer rate, and the indicators used to inform the buffer decision. Given shortcomings of the credit-to-GDP gap as a reference indicator for CCyB decisions, particularly after periods of prolonged excessive credit growth and for transition economies, some member states developed adjusted indicators and placed greater weight on additional indicators and discretion to arrive at a policy judgment. After that, the most frequently introduced measure in 2018 pertained to the caps on debt service-to income (DSTI) ratios. Changes to the methodology used to identify systemically important institutions (SIIs) and to set their buffers were also made relatively often.

     

    Related Link: Report (PDF)

     

    Keywords: Europe, EU, Banking, Systemic Risk, CCyB, CRR, SyRB, CRD IV, Macro-Prudential Policy, Macro-Prudential Measures, ESRB

    Featured Experts
    Related Articles
    News

    MAS Amends Notice 610 on Reporting Templates for Banks in Singapore

    MAS published amendments to Notices 610 and 1003 related to submission of statistics and returns, along with the reporting templates and frequently asked questions (FAQs) associated with these Notices.

    January 24, 2020 WebPage Regulatory News
    News

    HKMA Updates Policy Module on Supervisory Review Process

    HKMA is issuing, by notice in the Gazette, revised versions of two Supervisory Policy Manual modules as statutory guidelines under section 7(3) of the Banking Ordinance. The Supervisory Policy Manual modules are CA-G-5 on “Supervisory Review Process” and SB-2 on “Leveraged Foreign Exchange Trading.”

    January 24, 2020 WebPage Regulatory News
    News

    PRA Amends Pillar 2 Capital Framework for Banks

    PRA published the policy statement PS2/20 that contains the final amendments to the Pillar 2 framework and provides feedback to responses to the consultation paper CP5/19 on updates related to Pillar 2 capital framework.

    January 23, 2020 WebPage Regulatory News
    News

    FED Proposes to Revise Information Collection Under Market Risk Rule

    FED proposed to revise and extend, for three years, FR 4201, which is the information collection under the market risk capital rule.

    January 22, 2020 WebPage Regulatory News
    News

    HKMA Consults on Stay Rules on Financial Contracts Under FIRO

    HKMA published proposals for making rules related to contractual stays on termination rights in financial contracts for authorized institutions under FIRO or the Financial Institutions (Resolution) Ordinance (Cap. 628).

    January 22, 2020 WebPage Regulatory News
    News

    MAS Amends Notices on Minimum Liquid Asset Requirements for Banks

    MAS published amendments to Notices 1015, 613, and 649 related to the minimum liquid assets (MLA) requirements.

    January 21, 2020 WebPage Regulatory News
    News

    APRA Publishes Submission on Fintech and Regtech

    APRA published its submission, to the Senate Select Committee, on financial technology and regulatory technology.

    January 21, 2020 WebPage Regulatory News
    News

    OSFI to Implement Operational Risk Capital Rules for Banks in Q1 2022

    OSFI decided to move domestic implementation of the revised Basel III operational risk capital requirements from the first quarter of 2021 to the first quarter of 2022.

    January 20, 2020 WebPage Regulatory News
    News

    ECB Consults on Guideline on Threshold for Credit Obligations Past Due

    ECB published a draft guideline, along with the frequently asked questions (FAQs), on the definition of the materiality threshold for credit obligations past due for less significant institutions.

    January 20, 2020 WebPage Regulatory News
    News

    OSFI Consults on Instruction Guide for Termination of Pension Plan

    OSFI is consulting on draft revisions to the instruction guide for termination of a defined benefit pension plan.

    January 20, 2020 WebPage Regulatory News
    RESULTS 1 - 10 OF 4526